Child Plans

The things that make child plan policy special are:

• It offers a comprehensive gain of both life insurance along with offering maturity benefits to the child.
• It serves as a safety net to make sure that the child could fulfill his/her education goals.
• Child plans also help a child to have a lump sum amount as payout in case of any untoward situation with parents. This amount helps the child to pursue education without difficulty.
• Further, in case of the policyholder's (parents') death, the future insurance premiums are paid by the insurer and she/he receives the maturity benefits at the end of the policy.

Saving Plan and Investment plans are the two types of child plans available.

In a savings plan an individual pays regular premiums for the required time period and when the policy matures the policyholder receive guaranteed payouts. On the other hand, in an Investment Plan, the amount is invested in the market. Here, the premium paid by the policyholder for a particular duration of time is invested in debt and equity funds. These are risky, market-linked policies and allow good returns on investment.

It is a kind of insurance policy that allows protection against the child's future in terms of education and higher studies. It allows the parents an opportunity to save a capital for their children to ensure their good future. This saving helps the child to obtain the education of their choice.

A child insurance plan is important because it allows parents to save enough for their child's future. Further, it allows parents to make sure that their children do not have to compromise on their dreams because of the financial crunch. So, if you want to secure the future of the child financially, you must buy the best policy for child education.

Yes, you can easily withdraw the money after completion of 5 years of the policy. Partial withdrawal is also possible if required for the child’s specific needs (if any).

Yes, the proceeds received from a child plan as well as the money that the nominee receives in case of sudden death of parents or at maturity is totally tax-free.

Ideally the right time to plan a child education plan is when the child is born or before he/she starts school. This is because it will give enough time for the parents to have a lump sum capital. However, if you miss it at that time, you can still buy a child plan anytime during the schooling of the child to save for his/her higher education.

Yes, you can buy such a plan for your child aged 15-years. You can use either offline or online mode to buy such a plan. This plan will help the child receive a good amount of capital in case of sudden death of the head of the family.

In a child plan, a nominee is generally the person appointed by the policyholder to take care of the financial records of the insured after his/her death. The nominee has the responsibility to disburse the capital among the legal inheritors. A beneficiary, on the other hand, can either be a financial institution in certain cases, while in others the nominee and beneficiary can be the same.

Yes, under section 80 C of the Income Tax Act, you can have tax benefits on the premium that you pay for your child plan.

To select the right child insurance plan, you may consider aspects like:

• Tax benefits
• Monthly savings
• Coverage
• Children in the family
• Market situations
• Government policies etc.