The child education plan is one such plan that focuses mainly on your kid and includes a range of insurance products and services for prudent financial planning. It combines insurance and investment by investing in policyholder payments and making the maturity benefit accessible when the policy term expires.
A child education plan combines investments and life insurance to help your child achieve their objectives and goals. A child term insurance policy may be used to save money for your child’s long-term ambitions, such as college or marriage. An insurance plan serves as a safety net for the corpus as you work to acquire the corpus required to meet these goals for your kid.
You may use the whole amount to pay for your child’s education or other long-term needs. The child term insurance policy protects the child from the uncertainties of life by providing a death benefit to the youngster in the case of the parent’s untimely death.
Best Child Insurance Plans In India
The best child education plans for Indian parents are listed here.
1. Canara HSBC Life Insurance Smart Junior Plan
Canara HSBC Life Insurance Smart Junior Plan is an Individual Non-linked Par Life Insurance Savings cum Protection Plan intended to meet your child’s future educational requirements regardless of whether you are there or not.
The Smart Junior Plan offers guaranteed payments for the final five years of the insurance, which may be coordinated with a child’s academic achievements. Furthermore, the child term insurance policy includes annual incentives and, if applicable, a final bonus at maturity.
This child education plan offers total protection; in the event of the sad death of the Life Assured, a lump sum payment is paid immediately, and any outstanding premiums are not payable. The insurance remains in effect, and policy benefits are paid as planned.
2. Child Advantage Plan by Bharti Axa Life
This non-linked participation life insurance policy may be paid in cash or endowed. A premium waiver benefit is available under the child education plan. Let’s have a look at the benefits and features of the coverage.
The minimum age to enrol in insurance is 18, while the maximum age is 55. The full maturity age for the insurance is 76 years. The policy provides for a variety of policy tenures. Depending on the child’s age, the policyholder may choose a period of 11 to 21 years.
3. HDFC Life’s YoungStar Super Premium Plan
HDFC gives two kinds of death benefits. If the parent passes away within that time, just half of the payment will be paid. There are four investment funds to choose from.
Unit-related package with two options for death benefits If a parent dies during the term and selects the ‘Save-n-Gain’ payment option, half of the premiums will be taxed as annual income. There are four separate investment funds from which to pick. Severe sickness coverage is available as an add-on.
4. Smart Child Assure Plan from ICICI Prudential
This is a Unit Linked Insurance Plan that allows you to save money while also providing insurance coverage for your children’s future. The following are some of the pros and disadvantages of insurance. There are two premium payment choices available under the child education plan: regular pay and single pay.
The maximum maturity age for the insurance is 64 years. The plan covers many different investment fund options. The coverage ranges from ten to twenty-five years.
Advantages Of Child Insurance Policies
It’s a good idea to compare a few different insurance policies before deciding. This will help you create a list of your criteria and choose the best child term insurance policy for your requirements.
Understanding the components of a child education plan can assist you in making a more informed decision. The most important aspects that contribute to the success of kid insurance plans are as follows:
1. Long-Term Investment Possibility
A child education plan provides short-term and long-term investment options, depending on your requirements. Long-term investment options or assets, such as equity funds, should be part of a solid investing plan for your kid. The longer the investing plan, the higher the reward at maturity.
2. Protection of the goal
The Goal Protection with child education plan protects your child’s future education and other vital expenses even if you’re not present. It invests and pays out a life insurance payment if the insured individual dies. If the insured dies before the maturity date, the policy’s nominee will get the maturity value.
3. Funds That Can Be Withdrawn Partially
It is usual to remove a portion of a child’s life insurance policy. This feature allows you to withdraw a certain amount from your fund value numerous times over the plan’s lifespan.
4. High Profits
Returns on child education plans might be as high as 12%, higher than inflation over time. Child insurance programs allow your money to increase faster while safeguarding it from deterioration.
5. On Death Benefits
A Death Benefit is essential because it protects your kid even if you are not there. If the policyholder dies before the end of the policy term and has paid all premiums up to that point, the policyholder will receive a death benefit. As a result, a child term insurance policy ensures that your child will not be financially disadvantaged.
6. Maturity Benefits
A Child Plan ensures that you have enough money saved to meet your children’s expenditures even after the insurance term has expired. The Maturity Benefit is paid after the insurance term. If your term insurance policy has a Premium Waiver clause, your kid may continue to use it after you die. If you have a Premium Waiver, they will not have to pay the remaining premiums after you die.
Wrapping It Up
As a parent, you would never jeopardise your children’s future, particularly their education. Investing in a child education plan, on the other hand, allows you to plan ahead of time and ensure that your child remains healthy no matter what occurs.
There are many other kinds of child plans available, including market-linked and conventional plans and basic and lump-sum child education plans. Choose the one that best meets your requirements after analysing the various premiums and incentives. A child’s life insurance policy may help pay for their education, including extracurricular activities and post-secondary education.
It also helps your money grow, providing your kid with the financial stability they need to withstand the effects of inflation. Consequently, a child life insurance policy is meant to protect and preserve your kid for the rest of their life.