6 min read
Updated on Sep 13, 2023
With life being uncertain every moment, you do worry about the future of your child in your absence. This is why it’s a wise decision to invest in an insurance plan for your child right now when you can secure their future in your present. Read on to know more about how to choose the right child insurance policy for your kids.
Life insurance is not just for us adults. Even our children require and truly deserve to be insured against all the odds that life throws at them (or intends to throw at them) in the future. While we cannot control what is in hold for us, moving forward, we sure can offer our little ones the protective umbrella of insurance so that they can move ahead with pride and confidence in every area of their life. In this regard, a child insurance plan is what you should definitely consider investing in.
Just like we buy insurance for ourselves, to secure our future financially, an insurance plan for children has been designed to help ensure a financially secure future for them as well. With the intense growth in competition, our children would only need to spend more and more on education, career goals and aspirations, and even personal areas of life, such as marriage. Financing all of this on your own is not going to be easy.
To make matters worse, in the untimely, unfortunate event of your death, who would take care of these essential expenses for your child? It only helps to give these grim ideas a thought once in a while. This is why child life insurance plans have been launched to help your kids realize all their dreams and goals in life without a financial worry on their mind.
A child plan is nothing but essentially an insurance policy in the name of your child, with the sole purpose of helping finance their basic future needs – education, job, marriage, and the like. Once you decide to invest in a child insurance policy for your kids, you begin by choosing between Unit-Linked Insurance Plans (ULIPs) or Endowment Plans.
An Endowment Plan is a simple, most basic form of insurance product offered by insurance companies. Herein, the policyholder is assured a lump sum amount upon the end of the policy term or in case of death (whichever is earlier).
A ULIP plan, on the other hand, serves the dual purpose of insurance and investment for the policyholder. This is unlike a simple Endowment Plan because here the investor is allowed the flexibility of choosing where to invest their money in the capital market, in addition to securing life insurance from the insurer. Both these features are included in a single integrated plan and this is what makes ULIPs more attractive and favorable to most investors.
Once you have chosen the type of plan you’d like to invest in for child insurance, you can state your payout preferences to the insurer. For instance, you’re given a choice to decide whether you would like to receive a lump sum amount at the end of the term plan or regular payments monthly or yearly.
Once these details are worked out, you can start paying the premium amount for the child insurance plan, after which it would become effective.
As the name suggests, an insurance plan for your child helps secure their future financially, so that they don’t need to depend on anyone in your absence. But besides that also, a child education insurance plan offers several benefits, some of which are:
With most insurance companies today offering child insurance plans, it is a good idea to do your research before finding the best plan to invest in for your child’s future. Here are some useful tips that can help:
With so many benefits on offer for your child’s secure future, it only makes sense to invest in a child insurance policy. Look up online for the best child insurance plan in India 2022 and take your pick today for a healthy and stable future of your little one .
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