Life insurance policies are designed to make life easy for their beneficiaries. The life insurers study the problems that a person may face and devise financial solutions to alleviate them. One of the big problems that many people struggle with is providing their children with a healthy future. The cost of higher education is truly debilitating and is one of the biggest stressors for parents. To alleviate this problem to a great extent, life insurance companies have come up with a specialized plan called child insurance.
Child insurance has a double benefit for the child. First, they help generate a good corpus by investing the premiums in a fund that can be capital-based or ULIP-based. Second, they provide life insurance coverage to the investing parent whose child is the beneficiary. In the event of the death of the policyholder, the insurance company waives future premiums and continues to invest in that fund on behalf of the policyholder. In addition, it pays a lump sum or periodic amount for the maintenance of the child. This way, these plans protect the best interests of the child, even when you are not with him/her.
Saving money on our own can be difficult because we can’t be that disciplined unless we go into a plan that forces us to deposit a certain amount, otherwise it would expire. Such a routine is mandatory for systematic saving and investing. The proceeds of other funds or investments can be spent on other things. That is why it is better if you have your own child plan in your investment portfolio of which only your child is the beneficiary.
According to financial experts, investing in such a plan should be started as early as possible to allow more time for your money to grow. Ideally, you should start comparing child insurance policies from different companies as soon as you know you are pregnant. There are more than twenty companies selling such plans and offering differentiated plans to stay competitive. Effective plan comparison and market research will guide you to the most suitable plan from a reputable company.
For an effective comparison, you can try the services of an insurance web aggregator. On a web aggregator website, you can compare plans from dozens of companies in a single web location and that too for free. Such an effective comparison gives more confidence in your purchase and helps you take informed steps when selecting your plan type. Based on such comparison and analysis, you can decide whether to go for a capital-based child plan or a ULIP-based child plan. By comparing premiums with your budget, you can determine which coverage you want.
If you are a parent, start the process now without wasting any more time. Your smart actions now would earn you immense gratitude from your child in the future. Don’t miss the chance to have that bloated chest when your child makes a lucrative career for himself. His hard work will not do that alone. He needs your financial support to climb that ladder.