help create a corpus for crucial stages in the child’s life
It is never too early to plan for child plan. Expenses involved in child education, child health care and planning for children’s future are sky-high, and are only expected to increase further in the future. With child health care taking up the chunk of family expenses, the need for child health Policy and one with low insurance Premium is only more acute than ever. What is child plan, what are its advantages, and how could you get the best out of your insurance premium?
A child plan is one that assures payment of a lump sum in the event of an unexpected demise of the policyholder. Child insurance is designed to continue till the designated Maturity period, to cover the full Term of the policy, with regular payment of insurance premium. Child insurance is a standard option available with most insurance service providers.
Child plan is intended to provide the best benefits to children when they need them the most, irrespective of what happens in the mean time to the policyholder. The Policyholder could invest in child plan during the early years of his or her child, and could expect the child to be covered for all kinds of expenses, as in the case of child education, child insurance or as a child health policy, in the event of the unexpected and untimely demise of the policyholder.
Usually, child plan could be a Traditional Plan that invests in debt and is for those with a lesser Risk appetite. However, there are also options in child insurance that are geared towards higher returns by investing in equity with plans that are market linked.
There are suggestions, when it comes to returns on investments, to invest on term plans and in mutual funds rather than on child policy for low insurance premium. However, it needs to be noted that further investments would not occur in regular plans upon death of the policyholder. On the other hand, with child policy, investments would continue into the policy even after the death of the policyholder, and all further premiums would be waived. And the child would continue to get the benefits of the investment without insurance premium.
Start early: One of the first things that you need to do with child health policy, child health care or with child policy is to start early. While investment in child insurance could normally be planned before teenage, you could benefit from low insurance premium by starting off much earlier than that. You could start investing in child health policy or child health care as soon as your child is born, since it may take some time for you to scout around for child insurance that offers low insurance premium.
Go for tailored plans: Apart from benefits associated with insurance premium, starting early also helps you plan better for the different milestones in your child’s life, as child plan could be tailored to meet individual needs and circumstances. Further, child insurance is designed to focus more on equity in the initial stages and more on less risky investments in the later stages to prevent unexpected loss of value in the final stages, due to fluctuations in the market.
Shop around: Finally, take your time to shop around to find out the best value that you could get for insurance premium paid. Some professional advice would also help in identifying safe havens that also manage to balance between risks and returns.