Tag Archive | "Child Insurance"

ensure a bright future for your child through a customized child plan

  • Easypolicy
  • 19 Mar 2013

What is the best child plan that would secure your loved one’s future? That is the question that reigns high in the minds of parents who are anxious to get the best protection for their children. You may want to compare the child plan, contrast the features, work out the permutations and combinations and try to get the most out of your investment in a child policy. However, while most of the child plans offer benefits that are commensurate with market rates offered by the competitors, it may be in your own best financial interest to go for customized child plans, rather than opt for something off the shelves.

What is a customized child plan?

When you go in for a customized child plan, you would no longer have to compromise on the rate of interest that you would otherwise be able to earn on a regular investment of your assets. When you customize an online child plan, you could determine the returns that you would want to earn to match those you could command through other avenues of investment. It may so happen that what seems to be the best child plan may not yield the best dividends when you consider the long Term scenario.

A customized child plan, on the other hand, could be tailor-made to suit your own unique requirements and circumstances, where you could enhance your earning potential, without compromising on the insurance part of the equation. When you compare child plan, which would give you a return of 6% to 8% at best, customized child plans could, with planning and careful consideration, get you returns that are at par with the very best investment avenues in the market. You could do away with constraints such as premature withdrawal charges or switching charges associated with a move from one option to the other based on market conditions. If you plan on the long term, online child plan that lasts for around 20 years in duration could get you dividends much more than what you could get from any other traditional form of child policy.

What are the different types of child plan?

In a broad sense, child insurance is of two types – traditional plans and the ones that are unit-linked, i.e. ULIPs. Further, there are a host of Riders that you could add on to your child Policy to customize it to your needs.

Traditional child policy is the one that is offered by insurance firms and which are very similar in nature to endowment plans. An online child plan of this nature would have an investment and an insurance component, which gives you a clear idea of future and planned payouts in advance.

Unit-linked child plan, on the other hand, gives you the benefits of insurance cover coupled with investments that are equipped with high rates of returns. While they may feature an initial lock-in period, their withdrawal options tend to be flexible, while their rates of returns on the long run also tend to be reasonable. When you compare child plan, you would find that the unit-linked child policy tends to fluctuate in value with time. 

Riders in child plan: Online child plans gives you the freedom to choose while ensuring you could also compare child plan The best child plan also has provisions for riders, such as Waiver of Premium rider, which also come into plan in the event of death, disability, or dismemberment of the life insured.

are child plans worth the money?

  • Easypolicy
  • 12 Mar 2013

Every parent worries about his or her child’s future and wants the best for the little bundle of joy. This is the reason that parents start investing money with the help of different investment options in order to secure their child’s future. Some people even start these investment activities as soon as the child is born. Insurance companies have tried to cash in on this concern of  parents and have floated child investment plans. Many parents have gotten attracted by these investment plans and started investing for the secure future of their child. The question is that will investing in these insurance plans actually result in a more secure future for your child? Is child insurance worth the money spent on it, or should you look for other options? 

Let us understand what a child plan actually is:

A child Policy is similar to an endowment  plan and is a smart combination of insurance and investment. These plans allow parents to begin investing money right at the time of birth of the child. The invested money can be withdrawn when the child reaches adulthood. Some companies allow you to withdraw money prematurely as well. 

What is the amount of insurance involved?

The best child plan comes with an insurance component that is inbuilt and the child will get the sum Assured in case of the untimely death of the earning parent. However, according to experts it is necessary to have an insurance that pays 7-10 times the income of the earning parent to the spouse and the children in case of the death of the earning parent. Children’s insurance plans lay more emphasis on investment and less on insurance; hence you need to opt for an adequate amount of children’s insurance if you want to secure your child’s future in the event of your untimely death.

The investment involved in child plans:

•    The Premium is divided in such a way that part of it goes toward the insurance and part of it goes is invested in different instruments of investment like debts or equities.
•    However, in the initial years the amount that you get in terms of investment is quite less because several operational charges are deducted by the insurance company from the premium.
•    At the same time, you should make sure that you avoid stopping the plan prematurely because in this situation you will end up suffering a loss.
•    Again the amount that you invest in child plans should be adequate to meet the requirements that you have in mind in case of a mishap or even if you are just looking forward to such a plan as a means of investment.

Before opting for a particular plan you should make sure that you study the market and find out the different options available. The best way to compare child plan is to look for an online child plan. Different insurance companies providing child plans have their own websites which give complete details of the child plans that they offer. You can compare the plans offered by different companies and choose the one that suits your requirements the best.

know more about the types of child plans

  • Easypolicy
  • 17 Dec 2012

Child plans are at the heart of every parent’s dreams about his or her child’s future. When you buy a child plan, it is much more than just another investment decision that you make – with so many different types of child plans to choose from, your decisions have repercussions with regard to the kind of future that your child could afford and enjoy.
Whether it is regular child insurance or an online child plan, the variants come in the form of Riders as well as in the form of the various instruments that you could use to get started with child insurance. And it is the variety and range available with the types of child plans that makes it even more compelling to buy child plan at the right time.

Types of child plans:

Child plans offered by insurance firms: One of the most popular forms of child Policy involves the ones that are designed and delivered by insurance companies. These child plans are seen to be on the expensive side since they are similar to endowment plans – they include an investment and an insurance component. However, the positive side is that you have all the liberty to plan it out. An online child plan, for instance, is an option that you could go for under this category, which lets you plan future payouts well in advance and plan the Maturity dates in line with future milestones in the lives of your kids.

Unit-linked Child Plans: Popularly called as Unit Linked Insurance Plans (ULIPs), they constitute the right instruments to deliver high returns in combination with a reliable investment proposition. Some of the advantages when you buy ULIPs are:

Insurance cover

Investment with high returns

Flexible withdrawal options

Reasonable appreciation in value

Of course, you would have to weigh these positives against the risks of fluctuations in value of your investment with changing market conditions, whether it is a regular or online child plan.

Money back plans and child insurance: Traditional money back plans could be used as instruments of investment in child insurance. The positive aspect about the traditional money back plans is that you would be able to plan your future expenses based on the regular payouts. Further, you could hope for a lump sum maturity amount at the end of money back plans, making them one of the useful types of child plans. However, the returns from money back plans are usually less, and there is limited flexibility in terms of withdrawing your investment. 

Endowment plans for child policy: Endowment plans combine insurance and investment, where you could get insurance cover for a specified period and you would also gain from the guaranteed maturity amount at the end of the insurance period. With a combination of investment and insurance, you could plan your child insurance with an expected rate of return.

Riders in Child Plans:

The main idea behind a child plan is to make them just the right kind of tools to power your child’s future. Naturally, there are riders attached to child plans, which add value to the already useful child policy. Along with the various types of child plans, riders such as the Waiver of Premium rider allow for waiving off of any remaining premium upon instances such as death of the life Insured or in the event of any disability or dismemberment. These riders are of particular significance to child insurance, since under normal circumstances, any disturbance in the life of the parent could result in the child’s future plans going awry. When you buy child plan with riders, you could have so much more peace of mind.