Best 5 Tips To Buy Child Insurance Plans

Posted by sagar on September 27th, 2017

Once you become a parent, you don’t just have a new family member, but also become beholden to a bag of responsibilities. From raising your child to sending them off to college and then seeing them settled well – this is a long journey full of expectations and challenges. Throughout this journey we imagine your biggest priority would be to ensure that every need and want that your child has is taken care of without any compromises in their happiness.

child insurance plans

This is where a comprehensive child insurance plan can assist you in securing a bright future for your child. Child insurance plans provide economic support to your child in the years to come. In your absence, a child plan can provide required regular payments to look out for your child’s daily needs. Specialized schemes like child education plan look out for the long term development goals of the child by providing adequate finances for education.

Choosing the best child plan in India can be a difficult and confusing task, as the market is littered with plenty of insurance schemes. While selecting a child plan, these factors should be kept in mind:

  • Starting early: Planning for your child’s future should start as soon as they become part of the family, so that you are ahead of any future requirements, no matter the circumstances. The earlier you buy a child plan, the bigger your corpus will be. A child plan gives you a long time where you can methodically build your corpus and initiate long-term investments.
  • Sum assured: While estimating how much to invest in a child plan, it is essential to factor in rising inflation costs and your lifestyle in your calculations. It is also important you know the time frame when you need to get the returns. The maturity amount should be enough to meet the future needs of your child sufficiently. By future needs, think of not just education or marriage, but consider any extra-curricular hobbies that your child may want to partake in. Like, hockey or violin lessons, for example.
  • Premium waiver benefit: Choose a plan that offers you a premium waiver benefit. With this benefit you can ensure that the child plan continues even after your demise, with the agreed upon maturity benefit still intact. Most companies provide you with premium waivers as an essential feature of their plan.
  • Partial withdrawals: In any situation where you may require funds before the maturity period of the child plan, partial withdrawal benefit can come to your rescue. Partial withdrawal clause allows you to withdraw money at fixed, regular intervals for your child’s growing needs.
  • Investment options: Along with the risk cover, an ideal child plan must offer a judicious mix of growth and debt funds. If your term duration is longer than ten years, and you have an appetite for risk, you can consider buying a unit-linked child plan. However, if your investment frame is less than ten years and you are not equipped to deal with market uncertainties, you should go for endowment plans instead.

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