Who Else Wants To Know How Child Plans Work

The birth of a child brings immeasurable joy to parents. However, after the initial euphoria subsides, the future expenses start staring at you in the face. Add to this the innumerable ads on TV and print media, and you’re left with only one choice: buy a child plan.

That’s the beginning of your second problem – there are innumerable child plans out there. How do you know which one suits you the most?

Ask yourself these questions.

1. When will your child need the money?

2. How much will you need for the particular goal (marriage, education)?

3. How much will you be able to save?

4. How much insurance cover do I need?

Understanding Child Insurance Plans

There are basically 3 types of child insurance plans.

Money-Back: This is by far one of the most popular plans. Under this plan, your child will get survival benefits at regular intervals. For example, when he turns 18 years, he would get about 20% of sum assured, and a further 20% at age of 20 and so on. This plan is useful for those who feel the need for lump sum requirement at regular intervals and helps you in life stage planning.

Another benefit these plans offer is the premium waiver benefit, which ensures that in case of death of the parent, then the premiums are waived off and the policy continues with benefits.

A disadvantage of depending on this alone is that its returns often fail to match inflation, especially if you are planning to buy it for your child’s education. Education costs are growing at around 12% whereas money-backs would give you around 7-9%, leaving you grossly underfunded at the time of goal. Also, the premiums are steep.

ULIPS: ULIPs are non-traditional plans wherein returns are market-dependent. If the parent dies (or, as in the case of some policies, gets diagnosed with some critical illness), then the child would receive the sum assured in a lump sum. Also, future premiums are waived off and on maturity, the child would get the fund value too.

ULIP plans offer variety of funds ranging from conservative to balanced or aggressive. Under ULIPs, you can change from debt to equity and vice versa without the worry of taxation, thus enabling you to benefit from both timing the market and also rebalancing your portfolio.

But, ULIPs levy a variety of charges by way of premium allocation charges, policy administration charges, mortality charges, fund management charges, etc. This would affect the returns generated by the investment in market related instruments and ultimately the corpus that your child receives. Another negative of ULIP is that in case of an emergency, if you want to surrender or do partial withdrawal, the charges are high and also attract tax.

While a long term ULIP (above 15 years) could actually cost less than a mutual fund, it is less flexible. You just can’t move from one ULIP to another as in case of mutual funds. If you are putting your entire money in child ULIP plans and if it underperforms on a consistent basis, you are stuck!

Endowment Policies: Endowment policies are one where lump sum amount is paid at the time of the maturity along with bonuses. This is very useful to plan for your child’s big expenses like wedding, higher education, etc. And, unlike ULIPs, there is a minimum guaranteed amount of payment. Besides, you may get bonuses too.

Endowment policies too invest in market-backed securities, but unlike ULIPs, they invest only in debt products and the returns too are not exactly spectacular. And, if you require higher cover, you will have to pay a steeper premium. So, an ideal way is to take up an endowment policy as a debt portion of your overall asset allocation.

Almost all child insurance plans cover the parent and thus, if in an event of an unfortunate untimely death of the parent, the child’s needs would still be taken care of by way of lump sum payment on death and also on maturity. But beware of plans that cover the child and not the parent! It is your child who needs financial security and not you!

Another thing to be noted is that, there are riders like waiver of premium offered along with child plans to cover the untimely death of the parent. The policy continues here at the absence of the parent, but the benefit comes at a high cost as the premium increases due to this rider. And, the mortality rate charges for a child plan are quite high too.

Source: https://blog.bankbazaar.com/who-else-wants-to-know-how-child-plans-work/

Secure your child’s future. Get a Child Plans today.

Parents envision a bright future for their children. They want to be ideal ones in all the aspects. They are ready to do what all it takes and embrace sacrifices if needed. This stiff attitude of the parents is completely understood by the Indian Insurance Companies and they are coming up with different Child plans to render a promising future for the children without compromising on finances. This not only secures child future but also extends a helping hand in terms of financial support whenever required and safeguards it from all the eventualities.

There are various child plans available in the market. You can also go online and gain information pertaining to these plans. They carry various tenures and format. You can hunt for one you need the most for your children as per your requirements. It holds exclusive features as follows:

1    1)  It meets the child’s funding when it is required the most.

Child Plans provides funding for your child’s career or marriage at particular interval whenever required by you. These requirements are considered as milestones such like higher education’s funding, moreover, if you decide to get your child educated from abroad, it needs heavy cash outflow. Child Plans ensure these requirements and provide funding to ensure Child’s safe and promised future. It ceases these heavy expenses from eating out parent’s pockets. Parents always desire their children to opt for the best college or university to have elite education and child plan takes care of this at its best.

2) Unfortunate demise of the insured or parents doesn’t terminate the plan. Unlike other plans, child plans don’t get ceased by the demise of the insured or parents. It continues till the policy maturity date or throughout policy tenure. Insurance company accepts the liability of annual insurance premium payment. Apart from annual premium payment, insurance company also pays death benefit to the insured family to take care of their ongoing living expenses.

3) Parents can easily pursue their choice of investment mix: Child plan allows parents to choose an investment mix of their choice as their choice may differ from each other. They can choose to invest 100 percent of the funds in either debt or equity or a mix of the two. Parents can easily choose the plans of their choice meeting their risk return preferences from various available fund options. . Insurance companies realize that the risk appetite of parents may vary with time and hence they also offer a switching option which allows parents to change their investment mix as and when required.

Child plan is the best way to leverage your finances; plus you secure your child’s future without harming your finances.

Source: http://www.policyboss.com/knowledge-center/693/secure-your-child%E2%80%99s-future-get-a-child-plan-today

Saving for Children’s Education

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Choosing the Best Insurance Plan for Your Child

Parenting brings immense pleasure and joy to us. Along with this it brings a sense of responsibility, which can sometimes seem scary. The best way to avoid such scares is to plan for things which are predictable and then deal with situations for which we are not prepared.

One situation that we can always prepare ourselves for is the financial need of the children. Broadly speaking, the needs can be classified as medical, educational and marriage. Once we prioritise the needs we must allocate the required funds to meet these needs. 

These can be met either by way of investing in mutual funds or bank deposits in your name and making the child the nominee or directly investing in the child’s name which will yield you such sums that you need at the particular time.

While investing in children plans you must keep in mind two important factors:

1. Inflation – You require the funds at a later date and therefore must keep in mind the inflation at the time you require the money.

2. The exact time when you need the returns.

Having calculated these, you must analyse the plans that best suit your needs. There are a few plans, features of which are discussed below. You must analyse various plans and understand how they work before investing in the plan. The child investment plans help you to build a corpus that may come in handy for your children’s needs.

Different plans have different characteristics. You have to analyse the features in detail and choose the policy with care. Some features that could be considered for 

comparison are listed below:

Self-funding of premiums:

Some of the insurance companies pay the premium from their own funds in case the policy provider dies. This ensures that the maturity amount reaches the child as intended.

Flexibility of the plan:

Some plans allow for partial withdrawals; these plans help in case of urgent needs without disturbing the other planned expenses and income. This flexibility to switch investments from one fund to another allows you to capitalise on the market conditions. It also protects you from the volatilities of the market.

Child insurance plans are available in two flavours: traditional and unit-linked (ULIPs). While they are very different in their working and features, both help in creating the much need financial security. Unit linked plans (ULIPs) are market linked and therefore come with an inherent risk. The traditional plans suit the needs of those who are risk-averse.

Children plans have an added advantage over other plans as they give the payouts to children even if the policyholder is not around. Most of these plans are structured to give timely amounts for education needs, marriage needs and sometimes even for the business ventures as seed capital.

Many of the top insurance and banking companies offer child plans. Here is a comparison between them. Readers are wisely advised to check the policy details and invest in the one that suits their needs.

In the ULIP category the following child plans are available:

Assessing your needs and future requirements, form an essential part of buying a child plan. After careful consideration you may choose to invest in any of the child plans that are available in the market. If you have risk taking abilities then ULIP plans may work best for you. If you have a conservative mind set then the tradition plans suit you best.

[Source: https://www.bajajallianz.com/Corp/child-insurance-plans/child-insurance-plans.jsp]

Child Plans

Child plan secure future of your child as well as offer the financial security for his education. Most child insurance plans are designed for education benefits.

Today quality education requires huge amount, hence to meet this tremendous educational fees these plans are the best option in front of every parent.

All leading insurance providers offer this plans with attractive premium. These insurance plans come with lot of benefits such as death benefits or critical illness benefits.

If proposer that means parent dies during the policy period, then remaining premiums are waived and child will continuously get all benefits of the policy. Some child plans offer medical insurance coverage with the plan for your child.

Hospital and medicine expenses are covered under this medical coverage. You have lot of options available for this plan such as sum assured, premium waiver benefit, policy term and mode of premium payment. Every plan comes with its own benefits.

Child plans offers efficient and effective investment for your kid. Unfortunately if the child dies when policy is in force, then the policy holder will get paid premium back before commencement of risk and policy will terminate.

After beginning of risk period, the policy holder will get sum assured or accumulated amount whichever is high. If every thing will work out finely, then your child will get specified amount as per the policy.

Normally risk period starts after five year of policy for these insurance plans. If you take the policy in early years of child, then premium is very low. You can take this policy when your child attains the one year age or even at the time of birth of the child. These Child Plan policies pay periodic bonus amount also for unforeseen expenses of the child.

You can systematically craft future of your kid with the help of this policy. Premium also depends on coverage area and more coverage will cost more premiums.

We will help you to find out best child plans with maximum coverage at reasonable premium. You will get free quotes from website of insurance companies. These quotes will help you to find out best deal for your kid. We will help you to understand complicated terms of the policy documents.

We have negotiated the best for you and you can apply through us to avail the benefits of Child Plan. We will forward your application to right insurance provider within no time. You can trust us for our services and forget all your worries.

             [Source: http://childplans.over-blog.com/2015/10/child-plans.html]

Child Investment Plans - Child Related Tax Breaks

Child Life Insurance Plans in India

No joy can be greater than becoming a parent and to have your child in your arms. However, this happiness comes with a new set of responsibilities. Every parent strives towards providing their kids everything they would need; starting from birth of the baby to his/her studies and marriages to their eventual settlement.

The biggest dream of every parent is to provide a secure life to their children. Every parent wants the best for their kids. Choose a Child life insurance policy to ensure that their future is bright. Child plans offer the much needed financial support to the children.

Child Life Insurance Plans assist in handling the expenses for marriage and higher studies. This becomes more crucial if, due to some unforeseen circumstances, the family loses its breadwinner. A child plan secures his/her future under all the circumstances. Its helps you fulfill all the demands of your children without any compromise. To get a secure future for your child and a stress free life for yourself, all you are required to do is to invest a small amount from your income. This will take care of all the major expenses which you and your kid would face in the coming years.

Importance of a Child life insurance plan?

• A best child plan is needed to make certain that his/her future is secure. It is needed to aid them in leading a life of their choice by catering to the specific requirements and dreams of every child; to make certain that his/her needs are fulfilled at the right time.
• To help them in getting their choice of education as well as assist them in extracurricular interests.
• To ensure that they can choose a career of their interest, without worrying about the economic support.
• To make the dream of a perfect wedding come true; both for parents and their children.

How to select the most suitable Child plan?

If you are wondering on how to choose a suitable child insurance plan, then have a look at these suggestions below.

• Understand the probable future needs of your child then choose the plan which can fulfill those specific requirements.
• Consider every angle of the risks and your capabilities to bear them.
• Do decide with careful evaluation that whether you want to reap all the benefits at once or at different stages.
• You can choose broadly from two variants: traditional plans and ULIPs.

Best time to choose Child Policy:

There is no specific time. You can decide on best child plan insurance as soon you realize that it is needed. It can be on the day when your baby is born or the day he/she goes to school for the first time.

Things to be careful of:

When finalizing an insurance plan for child, make sure you have a trusted appointee for the plan. In case of your unseen absence, the appointee should be capable of taking care of your child in the best possible way; till your child becomes capable of handling his/her responsibility himself/herself.

[Source: http://childplans.ghost.io/child-life-insurance-plans-in-india/]