Child Insurance
Useful Tips To Secure Your Child's Future
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Child insurance plan is a widely available financial product and most insurers offer it with different riders to appeal to a wide variety of customers.
These plans are ideal for people who want to secure the future of their child without any market-related risks. The funds collected for child endowment plans are invested in debt securities which do not promise high returns but carry low risk.
These plans offer insurance cover along with decent returns on investments. The money is invested in a mix of equity and debt, with a higher allocation to equity. Higher exposure to equity ensures a higher return for your investment.
As the name suggests, these plans require you to pay the premium at once. The single-premium payment tenure ensures that you do not have to monitor the policy for timely payment of premiums. Insurers also offer discounts on the payment of major amount in a single instance.
These plans provide ample flexibility to parents in payment schedule as well as the risers. The premiums can be paid yearly, half-yearly, quarterly and even monthly. Insurance companies also provide certain benefits linked to payment schedules.
Child insurance plans are part of broader child specific financial products, which also include child education plans. Child insurance plans are a mix of insurance and investment products, which ensure the financial security of your child’s future. These plans pay the life cover as a lump-sum amount at the end of the policy term. Besides the lump-sum payout, child insurance plans also have periodic payments which coincide with the crucial milestones of your child’s education. Child insurance plans are generally customisable with options to add a variety of riders that enhance the plan as per your child’s specific needs.
A protection and savings oriented Unit Linked Insurance Plan which not only gives you choice to opt for protection suitable to you but also provides you opportunity to save for your dreams & life goals. Moreover, it adds back to your savings through Loyalty Additions & Wealth Boosters and also returns the Mortality Charges on policy maturity thereby maximizing your savings.
Our Smart Future Plan is a unit linked plan that provides long-term investment opportunity to fulfill various family needs like building an asset or to ensure a bright future for your child. Its comprehensive insurance cover (Sum Assured on death and Premium Funding benefit on death or disability) ensures that your plan for your family continues unaffected, in any unfortunate event.
Each one of us strive to give best of the things to our loved ones' in our journey of life. Be it child's education, marriage, leaving behind a legacy, buying a dream house or a blissful retirement with our loved ones'. However, to fulfil all these important goals in your life time you require a disciplined financial planning. Therefore, we recommend you to be prepared for the unexpected. To help you plan and achieve your goals in life, we present Canara HSBC Oriental Bank of Commerce Life Insurance Jeevan Nivesh Plan.
Our Future Smart Plan is a unit linked child plan that provides long-term investment opportunity to build a bright future for your child. Its comprehensive insurance cover (Sum Assured on death and Premium Funding on death or disability) ensures that your plan for your child's future continues unaffected, in any unfortunate event.
During your life there are various needs and milestones for which you need to plan and be financially ready. These milestones could be related to your aspirational needs such as vacation or purchasing a new home, or your child's education or extracurricular activities. Money Back Advantage Plan provides financial protection to your family by offering life cover and the milestone based payouts through guaranteed money back payouts and maturity benefit.
Smart Junior plan provides Guaranteed* payouts during the last 5 years of policy which can be aligned to child's educational milestones. Further, the plan also provides Annual bonuses and Final bonus, if any, on maturity.
This plan provides comprehensive protection - in case of unfortunate demise of Life Assured - a lump sum amount is paid immediately and the remaining due premiums, if any, are not payable.
Child insurance is formulated to ensure that your children have a safety net during crucial moments in life. Being children-specific these plans are tweaked according to their special needs:
The premiums for child insurance plans can be paid as a lump-sum at the start of the policy or periodically for a specified term. Most insurers provide an option to pay the premiums on an annual, half-yearly, quarterly or monthly basis. The premium amount depends on the expected returns and the sum assured.
Child insurance plans provide life cover along with maturity benefits. The sum assured for the life cover is paid in case of the policyholder’s demise. As a thumb rule, the sum assured should be over ten times your annual income.
The policy tenure of child insurance plan is typically between 5 years and 30 years. The tenure can be selected from the birth of the child to a pre-defined age.
The maturity amount is one of the most important features of a child insurance plan. Child insurance plans are taken with a specific goal in mind and if the maturity amount falls short, it would defeat the purpose of the policy. While choosing the maturity amount you should take into consideration factors such as inflation and interest rates.
Child insurance plan is taken to ensure that your child has the required resource at his/her disposal when the need arises. These plans offer different payout options. For instance, Canara HSBC Oriental Bank of Commerce Invest 4G plan provides an option to receive the maturity amount in instalments at a frequency chosen by you. This segmented payout takes care of the child’s financial needs at different stages such as education, marriage, etc.
An important feature of child insurance plan is the premium waiver benefit. In case the policyholder dies in a stipulated duration, the beneficiary gets the sum assured and the insurance company continues to pay the remaining premiums till the maturity date. Invest 4G plan provides three benefit options, with the premium funding option being one of them.
Child insurance plans come with a variety of riders. The most prominent add-ons offered with child plans are critical illness cover, accidental death cover and the premium waiver option. Some insurers offer the premium waiver option as an in-built feature. The critical illness cover protects against a set of terminal diseases, while the accidental death cover provides an additional sum in case of accidental death.
Insurers offer partial withdrawal facility with child insurance plans to take care of the sudden need for liquidity. Invest 4G plan allows partial withdrawal without surrendering the policy after the 5th policy year.
A part of the premium paid for a child insurance policy is invested in market-linked assets. The insurance company provides the policyholder with an option to choose from different funds. The funds invest in equity, debt or money market instruments.
Even though the details of eligibility criteria for child insurance plans vary between insurance companies, it broadly remains similar. The entry age is generally between 18 and 65 years. The maturity age is between 23 years and 80 years. You can start investing in a child insurance plan with Rs 5000 per month. The minimum payment for annual mode is around Rs 50000. The policy tenure varies between 5 years and 30 years, but it is not advisable to stay invested for a short tenure as it would adversely impact the returns.
It is the form where all the policy-related information is entered.
Any government-issued document such as passport, driving license, Aadhar card, electricity bill, that can be used as the proof for address.
The individual buying the policy has to produce documents to prove that he has sufficient income to pay the premiums.
Any document such as PAN card, Aadhar card, driving license, Voter ID that can be used to establish the buyer’s identity.
The buyer’s passport, birth certificate, or 10th and 12th mark sheets can be used for age proof.
No parent wants to leave his/her child in the cold, but you will not be able to secure your child’s future just by having intention.
A child insurance plan helps you create a corpus for your child’s needs. Having adequate funds in times of need is critical for your child’s growth. With premium funding option, your child’s future will be secure even if you meet with an unfortunate incident.
If you have to save Rs 12,000 in a year, it is better to save Rs 1,000 every month rather than Rs 6,000 in the last two months. A child insurance plan helps you maintain discipline while saving for your child’s future. With the monthly payment tenure of Invest 4G plan, you can set aside small amounts for your child’s future.
Children are delicate and often fall ill. Child insurance plans provide an option for partial withdrawal of funds without surrendering the policy. The partial withdrawal facility can be used for medical treatment of the child.
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Read ArticleAny parent with a child between 0-15 years should opt for a child insurance plan. It helps you deliver inflation-beating returns for the various needs of the child while he/she grows up. As a child grows up, his/her financial needs increase substantially.
The importance of a good education cannot be overstated. Without quality education, a child may not reach his/her full potential. But the rising cost of education can become an impediment in higher education. A child education plan ensures that you do not have to worry about the money for your child’s education. It is a mix of insurance and investment. A part of child education plan is used to provide the financial security of insurance, while the balance is invested in market-linked instruments. The investible portion delivers decent returns in the long run, helping you accumulate a corpus for your child’s education.
Child plans are tailor-made financial products designed to secure children’s future. Typically, child plans have two components—insurance and investment. The insurance component protects the child in case of the parent’s demise, while the investment helps in accumulating a corpus for the child’s needs such as education and marriage. Child plans have several features that are primarily aimed at financially securing children. Some of the features are:
The right time to buy child plans depends on the financial goal and the type of policy. Child insurance policies are long-term instruments and to generate decent returns it is advisable to invest as early as possible. You can invest in child insurance policies even before the child is born. Child education policies are relatively short-term policies. Child education policies can be chosen according to the financial goal. You can invest in child education policy as soon as the child is born if you plan to fund his/her primary and secondary education through the policy. If the aim is to accumulate funds for the higher education of the child, then you can invest at a later stage. In any case, it is not advisable to invest after the child has turned 15.
Child plans are meant to build a financial buffer for your child’s future needs, so, it is important to have a fail-proof plan. A few things to consider while buying child plans are:
The eligibility to open a child education plan is similar to a child insurance plan. The entry age is generally between 18 and 65 years. The maturity age is between 23 years and 80 years. You can start investing in a child education plan with Rs 5,000 per month or Rs 50,000 per year. The policy tenure varies between 5 years and 30 years.
There is no universal minimum instalment for a child education plan. Every insurer has its own minimum limit, even different plans have a different minimum limit. Invest 4G plan has a minimum limit of Rs 5000 if you choose to pay monthly premiums. The minimum premiums for quarterly and half-yearly payment tenures are Rs 15,000 and RS 30,000, respectively. In the annual mode, the minimum premium is Rs 50,000.
Child education plan can either be unit-linked or non-linked. The interest rate of ULIPs is determined by the fund chosen by the policyholder and the performance of the market. The interest rate for non-linked child education plan is decided by the insurance company.
The policy for premature closure of child education plan deposit differs from insurer to insurer. Some insurers allow premature closure of child education plan deposit. If the account is closed before the lock-in period expires, the fund’s value minus the surrender charges id deposited in the discontinued policy fund. The amount earns a minimum of 4% interest and will be paid to you after the lock-in period gets over. It the policy is surrendered after the lock-in period, the total fund value minus the surrender charges will be given to you. But premature closure of child education plan can be fraught with risks and you may not achieve the stated aim. Invest 4G plan allows you partial withdrawals without surrendering the policy, which essentially disincentivises premature closure of the policy.
Child education plans come with flexible payout options. You can either set up a standing instruction for instalment payment when you buy the policy or inform the insurance company during the policy tenure. Insurance companies generally accept requests for instalment payment a few months before the maturity.
One of the defining features of child education policies is the partial withdrawal facility. Most insurance companies allow partial withdrawal from child education plans to take care of liquidity needs. Invest 4G plan allows partial withdrawal after the 5th policy year.
You can avail a secured loan against a child education plan. The loan can be used to fund the higher education of the child.
Child education plans are like child insurance plans with some slight differences. Child education plans have relatively shorter tenures than child insurance plans. Child education plans have milestone payments coinciding with the educational stages of the child. These plans have a limited scope and are not dynamic products like child insurance plans.
When you buy life insurance, the insurance company asks for the nominee details. Only the person named as the nominee in the policy can cash out a life insurance policy in case of death of life insured.
Child education plan not just secures the financial future of the child but also provides tax benefits to the policyholder. The premiums paid for child education plan are eligible for tax deduction under Section 80C of the Income Tax Act. The maturity amount is also tax-exempt under Section 10(10D) of the income tax law.
While there are several child plans in the market, the Invest 4G plan is the best of the lot. Invest 4G with its unique proposition provides all-round protection to your child. With the online ULIP plan , you can decide the premium payment tenure and also the settlement option.
You can invest in a number of financial products for your child’s education. If you need a long-term savings instrument, the PPF is an eligible option. But if the child’s education is the sole aim of your investment, nothing is better than a market-linked scheme. Market-linked investments, especially equity investments tend to perform better in the long run. Investment in market-linked schemes can ensure handsome returns on your savings by the time your child grows up. Opt for Invest 4G plan to give your child a secure educational future.
Getting insurance required a visit to the bank or the insurer’s branch earlier. But with the popularity of online ULIP plans, getting an insurance plan has become extremely easy. You can buy a host of insurance products directly from www.canarahsbclife.com and get discounts on the premium from the company.
While the cost of insurance depends on a host of factors such as tenure, coverage and the mode of payment. With Invest 4G plan, you can start investing for the financial future of your child with just Rs 5,000 every month. However, if you are not clear about the cost of insurance for your child, you can use the ‘life insurance calculator’ in the ‘tools and calculator’ section of www.canarahsbclife.com. Similarly, you can use the ‘child education planning calculator’ to get an idea of the cost of child education plans.
Considering the flexibility in the premium payment tenure and the payout settlement, Invest 4G is the best scheme for the child. The Invest 4G plan also provides the premium funding option which ensures the financial stability of the child even in the absence of the policyholder.
To choose the ideal child insurance plan, you will have to start with planning the various stages of the plan and your child-specific milestone payments.
To choose the ideal child insurance plan, you will have to start with planning the various stages of the plan and your child-specific milestone payments.
Having life insurance has become a necessity and the earlier you buy one the better. Life insurance plans are cheaper when you are young. Moreover, when you are buying products such as ULIPs that have an investment component, having a long policy tenure helps in compounding your savings.
Most insurance companies have started offering online policies. You can either pay through offline mediums or opt for online ULIP plans. Buying insurance policies online is cheaper and hassle-free. The premiums can easily be paid through the website or mobile app.
There are three major rider benefits provided with child insurance plans.
The frequency of the payout is decided by the policyholder while buying the insurance plan. Even if you fail to define the frequency of the payout while buying the policy, it can easily be rectified during the policy term.
You can appoint a minor as nominee for your plan, but you will have to nominate an appointee who will have to give his/her consent to act as an appointee. The appointee will cease to hold power once the minor nominees become majors. In the event of a claim, of your nominee is minor and you did not name an appointee, the proceeds will go to the legal heirs.
No child should give up on his/her dreams to study in premier institutes like IIT and IIM due to financial constraints. With the rising cost of higher education, investing in a child plan has become extremely important. Child plans help you save in a disciplined way for a secure financial future of your child.
Canara HSBC Oriental Bank of Commerce offers a plethora of child plans to take care of varied needs. With unique features such as fund switching, premium redirection, change in sum assured and return of mortality charges, child plans from Canara HSBC provide unprecedented coverage.
1. Amount of premium you have to pay based on your age, habits, education, and monthly income
2. The total number of benefits covered in the term plan. Do they include benefits that you care about the most?
3. How to save money on tax if you pay for the term plan?
4. Do they offer regular income options?
5. Can you change the coverage and premium in the future?
6. Does the claim consider valid if death occurs outside India?
7. Which kind of death is not covered by insurance?
8. Can NRIs take term insurance? If yes, what are the conditions?
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