help create a corpus for crucial stages in the child’s life
Looking for an insurance Policy for your child? If yes, then you are in the right direction to provide your child the best future. Your child’s ambitions are your dreams and if you want to see them come true, saving would not be the only way to do so. In fact, you have to think practical and find some smart ways to plan your child's future.
There are various investment options available in the market such as equity, debt, real estate, commodities, so on and so forth. But there is nothing like child insurance which can guarantee protection and investment at the same time and furthermore, can provide you tax deductions while saving for future. But before you buy any child plan, you need to understand certain points in advance. Each and every child insurance plan comes with its unique features set. And, it is essential for you to understand what your requirements are.
The early you start investing, the more is the time period and more is the growth of your investment. In fact, you should start investing as soon as you become a parent. Even if it is not so, ensure that your investment gets ample amount of time to grow at least 10 to 15 years.
Next thing to look at is for what you want lump sum amount for. Is that for education and marriage if you have girl child or is it building house for your son or his educational needs. Now, assume the average Inflation rate and calculate the approximate value of your needs after that specific period.
Once you are through with your requirements, search for the best child plan available in the market. For this, the first step would be to compare child plans available with different companies. Once you find the insurer, go for the detailed description of features and compare features of various child plans. You may find one set of feature suiting your financial needs. Still, it is not the time to finally procure the child policy. There you have so many variants available under child plan.
This is a plan that vows to protect your savings while investing it and making some fixed marginal profits after a certain period of time. In order to grow your savings, the Insurer invests the amount in government securities and bonds, mutual funds etc. where there is no possibility of loss but guarantee of fixed profit.
This plan works as per the market conditions and that is why it is also called as market linked instrument. The investor has the choice to pick the investment instruments like equity depending on his ability to cope up with the risk. Of course, it is not a completely Risk driven option. Only a part is taken as investment while rest is engaged in providing insurance service.
Almost every child plan comes with the feature of Waiver of Premium and child gets life cover of his parent immediately after the death of the parent. As well as at the Maturity of child policy, the family will be eligible to get life cover plus bonuses accumulated if it is Endowment Plan and market linked profits accumulated in case of ULIPs.
However, every insurance company has its own norms, therefore always check and read the documents before acquiring the child policy.