Children are the future of this world. A carefully nurtured and educated child becomes not only a successful individual but also a considerate and benevolent one.
Parents are always worried about their children. You spend your entire lives planning for their future and their present comfort. However, life is unpredictable. In the event of your sudden and unfortunate demise, your children would be left stranded. That is why child insurance plans have become such a necessary part of financial planning.
Table of Contents
What are child insurance plans?
Child insurance plans are policies that are designed to ensure the well-being of your children in the face of life’s many uncertainties. Child Insurance plans are an essential part of financial planning. They account for the various expenses related to your children to ensure that they have proper coverage to pursue their life goals, life stages, and dreams.
Child plans are uniquely developed policies that release payments at various life stages to support your child’s aims. The amount is dedicated to the betterment of your children’s life.
For instance, a child insurance plan would pay a certain amount to support your child’s future education such as college or to pursue post-graduate degrees. They may also pay a certain amount when your child gets married or reaches other significant life stages.
Financial stability is important to ensure a good and prosperous life for your child. With a viable child insurance plan, you can rest assured that if there is a financial crunch stopping your kid from achieving their dream, the policy will provide the financial support they need.
Benefits of Child Insurance Plans
There are several benefits to acquiring a suitable child insurance plan. These policies provide adequate financial support to help your child pursue their life’s purpose without the stress of constant financial setbacks. Here are the benefits of child insurance plans:
- It provides financial assistance to support your child’s dream. Whether they want to pursue higher education, a career abroad, or start their own business, the child insurance plans will help ensure they don’t have to quit their dreams.
- Child insurance plans help to develop a savings habit that is entirely dedicated to the well-being and fulfilment of your child’s life and dreams. These policies help you build a substantial corpus over the course of your life with timely payments. When the plan matures or the child reaches a certain age, they are privy to the financial support you helped build.
- It maintains constant financial protection for the child, even if unspeakable losses take place. Insuring your life with a child insurance plan helps guarantee that in the event of your demise, your child will not be stranded without support. In fact, certain child plans also waive the premium if the parent passes away. The benefits of the plan are immediately transferred to your child to ensure the uninterrupted pursuit of their life goals.
- Child insurance plans are also eligible for tax benefits. Under Section 80C of the Income Tax Act, the premiums paid for child insurance plans are qualified towards tax exemptions. Furthermore, under Section 10 (10)D of the Income Tax Act, the death benefit that your child receives upon your untimely demise is also exempted from taxes despite being a lump sum payout. Similarly, if the child insurance plans mature and you or your children receive the maturity benefit, it is also exempted from taxes.
- It provides peace of mind knowing that your child’s education, wedding, and other important life events will not be hampered due to lack of funds.
Child insurance plans are highly beneficial to ensure that your child is protected from financial liabilities in the future.
Securing all dependents with group insurance plans
Group insurance plans are a form of life insurance that covers the financial interests of a large team of people. These are popularly used by organisations to provide basic life insurance policies to their employees. However, the applications of group insurance plans extend beyond that.
Group insurance plans can also help protect your children. Typically, employers provide basic group policies for minimum coverage. These benefits extend to your family as well. You can protect your child, their health, and their basic necessities by nominating them in your company’s group insurance plans.
In the event of your demise, the basic coverage would also go towards protecting your child’s dreams.
Conclusion
Your child needs protection. Much like you protect them from mishaps on a daily basis, their dreams and health also require sufficient coverage.
Child insurance plans not only help your children pursue their dreams in the face of financial uncertainty but it also aids in acquiring assistance for their health and wellness. The objective of a child insurance plan is to provide dedicated support for your little ones till they grow up with a good education to take care of themselves.