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As a parent, you might dream of a bright future of him/her and investment is a vital step in doing so. Parents generally focusing on the major goals for their child such as marriage, education and a comfortable lifestyle as well. All these goals have different requirements, so it is essential to think about each separately and find the needful investment plan that can suit these requirements as well. For a bright future of your child, it is vital to think about the investment proposals as soon as possible.
Before investing everyone wants to be sure about the returns and the benefits that they will get in the future. Many questions arose in their minds at that time such as what would be the risks and benefit percentage? How will it help them?
Today the cost of education is so high that most of the parents are unable to provide their children the level of education they want. If this is the situation today, then you can imagine what would be the scenario in the future when the inflation will be much higher. A child future plan is designed to meet your child's future financial needs.
Child investment plans are essential to meet the needs of providing the child with the best of education and to make sure that the cash flows are there at every crucial stage of your child's growth. For instance, if your child is 4 years old and you plan to provide him higher studies after say, 15 years which costs Rs. 20 lakh today, then you can imagine how much would it cost after 15 years. Therefore, it become necessary to invest for your child today in order to have funds available at the time when the actual need arise.
There are two types of Child policies in India- Child ULIPs & Child Endowment Plan. The plan you should select is usually dependent on the amount of coverage you want and the tenure of the policy. PolicyX.com understands your concern as a parent and thus provides you with best insurance plans from leading providers such as Max Life, HDFC Life, Bajaj Allianz, Reliance, etc. You can compare and choose the best child coverage as per your requirement on our portal within minutes.
Here is a quick list to get you well versed with different criterion of some of the major insurance providers in the market:
|Plan||Entry Age||Maturity age||Minimium Premium||Sum Assured|
|ICICI Pru-Smart Kid Assure Plan||20-60 years||75 years||INR 15000||Sum assured is 5 times the annual premium|
|Max Life Shiksha Life Super Plan||21-50 years||65 years||INR 25000||Minimum- INR 50,000/-.|
|HDFC SL YoungStar Super Premium||30-60 years||75 years||INR 24000||Minimum sum assured is subject to underwriting|
|Birla Sun Life Insurance Vision Star Plus||18-55 years||75 years||No stipulation of minimum annual premium||Minimum- INR 1,00,000/-|
The life of a parent is full of executing important duties towards the child. Right from raising the kid from infancy to seeing him/her relax with their very own families -there are important matters one needs to attend to. Parents take care of everything related to the child and want to make sure that their child's every want is looked after with none compromised.
This is where child plans can help you in looking after your infant's education or marriage expenses in the years to come. All you have to do is make investment of a part of your income in a child plan to ensure you have got enough funds in the times ahead whilst your child would require it the most.
So the day your child desires to pursue a degree in architecture from abroad or a film-making course in a reputed institute, you're in a comfortable position to ensure his/her fees. And even if something unlucky happens to you, you are confident that the needs of your childrenare taken care of when you aren't around.
Take a look at different child insurance plans and give your child the first-rate gift of a comfortable future today.
What if you die five years after taking the plan? The term insurance policy will give a lump-sum for the instant needs of the family and in addition investments in the mutual fund will stop. The child plan, however, will now not pay the lump sum, however, make an investment on behalf of the policy holder. Insurers trust the waiver of premium function in a child plan as the most important thing as it does not let the demise of the policyholder derail the investment plan for his infant.
An Indian investor is continuously unnerved with market volatility and lacks the necessary discipline to create wealth over the long term. It's pretty likely for the person to set cash in a mutual fund for his infant.
However, a child plan will make the parent retain making an investment, for the simple reason of making sure that he saves sufficiently for the kid. You could stop paying the premium after five years, however, specialists say this should be a tactical ploy to keep away from a cash crunch, not a strategic flow to lessen one's investment.
Insurers say child plans are dependent on fulfilling the desires of the kid. A normal Ulip stops if the insured person dies. You must plan for it today. If you are looking to buy a good child insurance plan, then you should take help of an online insurance web aggregator that helps you in choosing the best child plan for yourself. You can take help of free insurance quotes and comparison service in choosing the best out of all. What to check:-
Ensures your child's future needs and allows you to plan in a better way to stabilize your future financially.
All future needs of your child whether its education, marriage, or business are covered and looked after
You have the provision of liquidizing your plan through partial withdrawals
You get tax deduction for the premium you pay under Section 80C and any income from the plan is tax-free under Section 10 (10) D of the Income Tax Act
You can buy the riders like accidental death benefit, income benefit and critical illness benefit.
Almost all major insurance companies offer child plans as an important insurance product in their portfolio.
These plans may differ on various parameters depending on individual needs and priorities and come with a customisation feature.
Because the call shows, those child plans provide the buyer a flexibility on premium payments, as in keeping with the benefit. One pays premiums yearly, half of-every year or quarterly.
Right here, the insured (figure) pays a lump sum quantity as a single premium for the entire term of the plan and be relieved from the duty of remembering payment dates. There may be no hassle of arranging the finances for premium payments throughout one-of-a-kind ranges of life. Some insurance companies additionally provide appealing discounts or decrease premium on such plans as they get the lump sum budget.
LIPs (Unit linked Plans) divide the premium received among debt and equity based totally investments for optimum returns. Child ULIPS make investments a small component in debt primarily based merchandise whilst essential amount is invested in equity products in order that the returns can be maximised for the kid over a long term. This includes higher risk, however then the chance of earning higher returns is also excessive! Also, the policyholder can determine how the premium may be invested and in what form of merchandise so the insured has a manage over his investments.
In these plans, the cash is invested in debt-based investment and the insurance issuer comes to a decision which products to put money into. Considering that it's debt primarily based funding, the returns are not that high, but it's should be in consideration to be secure compared to equity based investments and guarantee minimum returns.
There are many benefits that you will get after buying a plan. Mentioned below are the major benefits that you will get along with a best plan.
Basically life insurance for children provides you the flexibility to choose according to your economic status and superficial monetary goals. The rate of premium can also be settled as per your interest.
At the time of maturity, the sum assured amount and a definite partaking sum will be paid to the parent or guardian. In the case of early death of the policy holder, the child is allowed to receive all the benefits of the plan (if the rider is attached to the policy).
Yes, it is true that a child policy in India provides tax benefit that can be availed on maturity/death claim profits under Section 10 (10D) and assumption from income for the expenses of premium under Sec. 80(C).
For a great future of your ward, you must buy the best child insurance plan. By comparing service and free quotes, you will get the best and affordable child plan that meets your requirements easily. An online policy is a good option, it will assist you in comparing different plans of the top companies. It is worthwhile to look for best plan with riders and related features which make your plan more useful and effective. Riders provide additional benefits at low premiums. Some companies are offering riders as a part of the policy, whereas in few companies it is optional.
Riders provide a more secure and financially stable life to your ward. It is advisable to select a rider, according to your requirements. Don't think about the extra premium that you are paying for riders, consider the benefits that you will get and make your policy more powerful.
The most helpful riders are those which make sure that the policy will not terminate in the case where the policyholder dies during the policy period.
Future premiums are waived off for the child, in case of death of the insured. With the help of it, your child will not have the burden of paying the rest premium amounts.
The insurer will pay a lump sum amount for the treatment of your child in case of dreaded diseases that may hamper his future growth.
It is same as above, in this case the insurer will provide a lump sum amount for the treatment of your ward.
Here are some main features that you must look for hen you are purchasing a child policy for your ward's future.
The premium completely depends upon the type of coverage and sum assured that a consumer choose.
The best way to calculate the required sum assured is that the sum assured should be around 10 times your current income.
For this first check your war needs and his/her age and buy a policy till your child get on his feet.
A child policy must be offering many types of child insurance policies such as Premium Waiver Benefit, Accidental Death and Disability Benefit, Critical Illness Rider Benefit and much more just look for that.
Apart from this there are some more things that you must check such as maturity amount, waiver period, partial withdrawals and lots more.
Now the question that arises is that which is the best child policy for you, but there's no right answer of this question as the child policy depends upon the requirement of the policy holder. You should cautiously compare and then purchase the child policy that suits your need and which meets the future needs of your ward.
Many people ask how a child insurance plan really works? Will they be able to provide assistance on time? Will they help in dealing with all the upcoming expenses and so on. The basic step is that you have to invest an amount on the monthly basis for maximum 25 years. It will help you in saving a lot of money for your child with good returns that will help you in dealing with the child's education expense and later on, marriage expense as well.
Those child plans that are linked with ULIPs will get maximum returns for your child. It is found that unit linked child insurance plan is misunderstood just because of its high costs. They maximize the benefits after a long term period of the plan and you have to continue with the plan tenure. If you require good returns and nice growth, then you should be ready for the higher market risk that is involved in the same.
You must be not aware of those benefits that a child insurance plan can give you. It will take care of maximum financial needs of your child when you are there for them or even in your absence. It will help you in providing the best education for your child. Saving for a child insuranceis also the best thing for your insurance policy as well.
When you are going to shop for a child plan online or offline, you must keep a few factors in mind while choosing the desired one.
Factors that you must keep in mind while shopping for the best child insurance plan
Time period for building a good corpus
An estimation of the amount that is required to build a corpus
The age in which fund will be required
Investment avenues to be considered.
|Child Plan||Without Child Plan|
|Secure future for child for the rest of life||In case of financial losses, child's future is not affected|
|Better education without any financial worries||Child may be deprived of adequate or higher studies|
|In case of parents' death, daily life and financial needs of child are met||In case of parents' death, child will be dependent on outer help|
|Adequate planning for child's marriage||Marriage expenses are a big question in absence of an adequate investment plan|
|A corpus buildup over the years to take care of child's life||No money, no resources. You are putting a big question on your child's life.|
It comes at extra premium and allows the plan to continue, without burdening the child for paying the balance premiums, in case the insured parent dies
A little premium is charged to buy this rider, under which, the child receives additional rider sum assured if parent dies in an accident.
If the parent suffers permanent or partial disability due to an accident, the child becomes eligible to receive a lump sum amount, which is equivalent to the rider sum assured. Again, little extra premium is to be paid for this additional benefit.
If the parent suffers from a critical disease like Heart Attack, Cancer, Coronary Artery By-pass Graft Surgery (CABG), Stroke, and Kidney failure, child receives an additional rider sum assured. A small to large premium is charged, based on the age of the parent.
This rider makes the child eligible to receive 1% of the rider sum assured, every month, in following occurrences:
Death of the parent.
Permanent disability of the parent due to an accident.
Parent being diagnosed with any of the critical illnesses specified in the policy.
A small premium is charged to get the benefits of this rider.
It is advisable for you to calculate the required funds for your child education and marriage before going to buy coverage for children. With this additional information, you would be able to choose the best cover and can decide easily on the related premium amount and the time period of the child life plan. In some products you will get additional benefits such as accident cover, health, etc. You must compare child policies of different insurance companies on our site because with it, you can compare the premium amount per year and the returns presented by different companies.
Make sure to insure your life also. It is beneficial to buy a plan which has a built in clause premium waiver for the future. This would guarantee that the plan continues if you are not there to take care of it and your child would be able to receive assured sum amount at maturity. It is advisable for you to check the company's record before purchasing child insurance. Buy the plan in the parent's name instead of a child, since the child anyway has no dependants. But if you are planning to buy the best one in the child's name, then ensure that it has a built-in feature of premium waiver in case of death of the parent.
This will protect your child from the burden of heavy premium payments and he will continue to reap the benefits of the plan. Also do a check out the tax benefits of the plan.It is an incredible financial investment planning tool for child education / marriage / unforeseen expenses etc. It assists in meeting the child's monetary needs and provides safety in the form of a life insurance plan.
Age proof - Birth Certificate, 10th or 12th mark sheet, Driving License, Passport, Voter ID, etc.(Any one)
Identity proof - Driving License, Passport, Voter ID, PAN Card, Aadhar Card, which proves ones citizenship
Income Proof - Income proof specifying the income of the person buying the insurance
Address proof - Electricity Bill, Telephone Bill, Ration Card, Driving License, Passport, should clearly mention the permanent address
Proposal Form - Duly filled in proposal form is required
1. What is Child Education Plan?
ICICI Bank presents "Child Education Plan", a unique way to save for your child's future. To fulfill your child's dream & aspirations, begin by making small investments in a Recurring Deposit for a short tenure and receive regular payouts for the rest of the tenure in your child's "Youngstar Savings Account".
2. Can I take a loan on the Child Education Plan?
Yes. A loan of 90% will be sanctioned against the principal account balance of the Recurring Deposit in Investment Phase. In the Benefit Phase, the loan will be available at 75% against the remaining account balance of the FD and not the original principal amount.
3. Can I set up a Standing Instruction for installment payment in the Child Education Plan?
Yes, you can set up standing instructions through your ICICI Bank Account for paying the installments of the Child Education Plan in the Investment Phase.
4. What is the minimum installment amount for Child Education Plan?
The minimum installment amount for Child Education Plan is Rs. 500 and thereafter in multiples of Rs. 100.
5. How will the interest rate be assigned to Child Education Plan?
Child Education Plan will earn prevailing fixed deposit interest rates for the entire deposit period, i.e. same rate of interest in Investment and Benefit Phases. The rate of interest applied will be as per the total tenure of Child Education Plan, including both Investment and Benefit Phases.
5. Can I partially withdraw from the Child Education Plan?