Why a child plan?
Education costs rise every year. A child plan makes sure those goals aren't compromised if a parent dies or is disabled.
- Financial security for your child's future
- Life cover for the parent
- Goal-based savings
- Premium waiver benefit
- Long-term wealth creation
- Peace of mind
How it works
You pay a fixed premium for a set period and the plan builds a corpus. If you survive the term, maturity benefits are paid for your child's goals. If you die during the term, the insurer waives all future premiums and still pays the benefits as planned.
Types of child plans
01Child endowment
Guaranteed returns with life cover.
- Safe, stable
- Low risk
- For conservative investors
02Child ULIP
Insurance with market-linked investment.
- Higher return potential
- Choice of equity and debt funds
In unit-linked plans, the investment risk in the portfolio is borne by the policyholder.
03Education-focused
Built specifically to fund higher education.
- Structured payouts
- Milestone planning
How much to invest?
It depends on your child's age, the education goal, inflation, the horizon and your risk appetite. Starting early lets you invest smaller amounts and still build a large corpus.
Child plan or mutual funds?
Child plans give both protection and savings. Mutual funds are pure investments. Often the best approach combines the two: term insurance for protection and mutual funds for growth.
Tax benefits
Tax benefits are as per prevailing tax laws and are subject to change. Deductions under 80C / 80D apply to the old tax regime.
Myths
Who should consider one?
Insurance is the subject matter of solicitation. For details on risk factors, terms and conditions, please read the sales brochure carefully before concluding a sale.
In unit-linked plans, the investment risk in the portfolio is borne by the policyholder.
