Why Do You Need a Child Education Plan?
Let’s look at how a child education plan can benefit you:
The plan provides life insurance and an opportunity to grow your wealth through investments to secure your child’s financial future.
The plan helps ensure that your child receives the education they want with a lump-sum payout at maturity.
Child plans ensure you develop a habit of saving and investing for your child’s future, which enables you to combat the effects of inflation.
The plan acts as a safety net, providing financial support to your child in the unfortunate event that something happens to you.
How Do Child Plans Work?
Child plans allow parents to choose a life cover amount and how and where they want to invest their money for their child’s future. If anything happens to the insured parent during the policy term, the child receives the payout. We can understand how these policies work better through an example. Mr Kumar purchases a 10-year child plan for his 7-year-old son. He opts to make annual payments that get invested for his child’s future. Seven years after purchasing the policy, Mr Kumar meets with a fatal accident. After filing a claim, his son receives regular payouts, which is a part of the plan benefits. Mr Kumar’s son does not have to pay the remaining three premiums. On maturity, he receives the remaining maturity benefit amount, allowing him to use the money for his higher education.
