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Are you dreaming of celebrating your child’s success? Do you anticipate watching your angel rising up in academics or sports? Every parent, irrespective of nationality, age, or economic status, wants to fulfill their children’s dreams. Investing in a child plan is one major step in that direction. In fact, the need for child insurance has catapulted to a whole new level with the threat of COVID-19 looming over us.
For those unaware of the concept, child insurance plans are crafted to cater to child-specific needs like healthcare, education, and other related responsibilities. The best child plans offer benefits of both life insurance and investment.
Why Is a Child Insurance Plan Important?
For more than a year, the entire world has been battling the COVID-19 pandemic. Financial stability has become volatile in many families, especially if someone is hospitalized. Also, as classes go online, the education sector is finding ways to stay afloat, but how does one afford rising education costs? The answer lies in child insurance plans. Here’s how they continue to be a crucial investment for parents:
Gain Protection Against Serious Illness (Including COVID)
Because of changing lifestyles, children, even at a young age, are suffering serious health conditions. In any case, a good child plan can help you in treating your child well. During the COVID-19 pandemic, children are also at risk as they struggle with emotional and behavioral challenges. A child insurance plan not only saves you money but also offers worry-free medical assistance. This is because a good child plan will take care of healthcare costs not covered by other sources.
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Protect Children in Case of the Death of Their Parents
It is unfortunate to lose parents at any age. But the death of a parent affects children deeply, especially when they’re at a young age when they are entirely dependent on their parents. This is a doubly important point if the parents own a business. The children’s economic futures could be at stake in this case.
Additionally, as the pandemic rages on, many children have lost their parents. Child insurance can help them and their relatives answer questions about how to proceed. The child plan is integrated with insurance benefits that provide the child with the maturity amount after the parent’s demise. Also, they will get annual payments to sustain their regular life.
Cover Educational Costs
According to various surveys, the cost of education will rise in many parts of the world over time. Coupled with the high rate of inflation as well as the fact that parents may have insecure job status due to ongoing pandemics, the costs of education can become insurmountable for many parents. In this case, a child plan can help to remove the blocks that would otherwise hinder your child’s education.
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Invest Early for Lower Premiums
Parents can invest in a child insurance plan early to benefit from lower premiums. Also, you can more readily accumulate adequate funds for their future this way.
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What Are the Types of Child Insurance Plans?
There are two types of child insurance plans:
- Child ULIPs allow parents to invest a portion of the amount they pay in debt instruments and the rest in the equity, based on policyholder’s preference.
- A Child Saving Plan allows the policyholder to invest in the insurance plan without any market risk. It is a multi-faceted plan that provides life coverage, maturity benefits, and tax benefits, all in a single policy.
What Are the Features of a Good Child Insurance Plan?
A good child plan facilitates features of both investment and insurance. Some of the essential features are:
- Premium Amount – You need to pay the premium amount based on the maturity benefits you say you prefer.
- Premium payment mode – You can choose from a single lump sum amount premium or regular interval premiums, such as half-yearly, quarterly, or annual.
- Policy term – Your child’s age at the time of subscription will determine the policy term.
- Maturity amount – Maturity amount is received either on the parent’s demise or at the end of the policy. You can also withdraw the full amount of the insurance after five years of policy enrollment, but that depends on the child’s requirements.
- Partial withdrawal – For requirements like higher education, medical treatment, or marriage, you can withdraw the corpus partially after five years.
- Waiver of premium – In the case of the parent’s demise, the insurance company waives the rest premium, still offering all the benefits to the child.
After learning how important it is to buy child insurance, do read up on the factors and consider them carefully before buying a child plan.
Securing a child is the responsibility of every parent. Getting the best child insurance plan is the best option to fulfill this responsibility. So look online and secure your child’s future by investing in the best insurance plan.
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