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    How child insurance plans benefit the child as well as the parents

    By Deepak Yohannan
    Child insurance benefit the child as well as the parents
    With soaring costs and unexpected expenses at every turn, life sure has a lot of surprises for you at every crossroad. And speaking of costs, how can one ignore the rising costs of education? Education is believed to be one of the most expensive sectors worldwide.

    So if you want to ensure your child gets good education from the best institutions, you better start planning! Thankfully today there are some great investment tools available that help you plan and secure your child's future. The child insurance plans are some of the best tools.

    And not only your child, these plans have a host of benefits for you too. For starters, you as a parent get to plan out your finances over a prolonged period of time and this may almost totally relieve you of any major financial burden at any point of time. So take a look at the features of the child insurance policies and start planning.

    Basic idea of a child plan

    A child insurance plan essentially covers the parent. This means that the parent's (or any other guardian who pays the premium) life is insured in the interest of the child. If the parent dies within the policy tenure, the child will get the financial assistance needed to live a safe and comfortable life. If the parent survives the policy period, the sum assured or amount accumulated is transferred to the child for his/her education, marriage, etc.


    A child insurance plan allows a parent to start saving early. You can purchase a policy as soon as your child is born and invest for a maximum of 30 years. This gives you ample time to save in amounts small enough to suit your pocket and at the same time to ensure your child's future is secured.


    The policy can be bought for any child up to the age of 17. The policies are available for 10-30 years. The maximum sum assured is usually Rs.25,00,000. However, with riders, this amount can vary.

    If the premium is paid properly for the first 3 years, the policy qualifies for a host of benefits. First of all, if the parent dies, the premium is waived off and the policy continues till the time of maturity. This is a massive advantage as it ensures that even in your absence, your child's future is secured. Then, you can use the policy to procure a loan.

    Child plans can also be converted into money back plans. With the help of these, you can opt to receive sums of money at regular intervals to facilitate the needs of your child. For example, you can opt to get 10% of the sum assured at the time of the child's school admission, 15% at the time of his/her college admission and so on.


    Child insurance plans are a clever form of life insurance that acts as a surety for a child whose parent is insured. The plans greatly assist children as well as the parents and are an absolute must in today's day and age where expenses rise faster than incomes.

    The author is the CEO of

    Read more about: insurance
    Story first published: Tuesday, October 23, 2012, 10:19 [IST]
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