Parents are not only committed but also feel responsible about providing the best education to their child. A good education gives a child the much needed foundation for building a successful career in his life.
However, life is uncertain and parents remain concerned whether or not their child’s education needs would be met in case of their unfortunate demise. Parents can be relieved of these concerns and live in peace of mind if they choose to buy child plan.
With a child insurance policy
in hand parents are Assured
that their family would have enough money to meet the education needs of their child. Child insurance is available in various formats and parents can choose the one that best suits to their needs. Most life insurance policies terminate upon the demise of the Insured
but child insurance does not end there and the Policy
continues to be in force. There are important benefits offered under a children’s plan and here we discuss a few reasons why you should not avoid buying one for your child.
1) Death Benefit – Like in any other life insurance policy, in case of child plan too, the family of the deceased will receive a lump sum payment upon the demise of the insured person.
2) Premium Waiver – Most child insurance plans come with an option to purchase insurance Premium waiver rider. Under the premium waiver clause the insurance company will take the responsibility of future premium payments in case of the unfortunate demise of the insured.
3) Maturity Benefit - Unlike most life insurance plans which terminate in case of the death of the insured, a child policy remains in force till maturity. So in case of an early demise of the insured the family of the deceased not only receives the Death Benefit but also eventually receives the Maturity benefit as per the policy terms.
4) Option to stagger the maturity benefit payment at a predetermined time – Under a child policy the insured can choose to receive the maturity benefit in parts at different point in time.
The staggering option is important as it provides the insured necessary liquidity when it would be most required. Parents can choose to receive part of the maturity benefit when they expect their child to go for college education. With college education getting so expensive it may not be possible for many parents to meet the expenses out of their earnings. Payouts from the child insurance at this point in time will come handy.
5) Investment discipline – With a child plan you get the discipline of regularly investing your savings towards meeting the future needs of your child.