A proper child planning includes a lot of brain storming by parents. Most parents wonder whether buying a life insurance for their children is beneficial or not. As in today’s time having a life insurance is crucial in order to secure your family there are various reasons why your child need a life insurance policy.
The child will always be insured-
One of the major benefits of having a life insurance policy for your child is that he/she will be covered lifelong regardless of any future mishap. Prior buying any policy the insurance buyer should verify with the insurers that what type of policy they want to buy for the child so that they can insure the child’s future.
Moreover, buying a life insurance policy for your child also make him/her financial stable in case of any emergency. A child insurance policy helps to cover all the important milestones of child’s life and provide them a better life style.
It Provides a Peace of Mind-
Every parent plans to provide best to their children. The benefits of child plan are numerous. Moreover, having a child insurance plan by your side provides a sense of relief to the insured. A child insurance plan not only provides life coverage to the child but also takes the burden of their education in case of the absence of their parents. A child education plan provides money to the child in specific intervals of time so that they can complete their education without any hindrances.
Moreover, in many child education plans, the entire future premium is waived of and the insurer continues investing the money on behalf of child in case of the demise if the insured person.
The Policy Helps to Create little Nest Egg-
The life insurance policy for children helps to create cash value for the children so that when they reach to their teen age they have their own little nest egg. While you opt for a whole life insurance policy, cross check with the insurer whether there are penalties for early withdraw before certain age. Make sure that the life insurance policy that you opt for your child should work as a financial perk.
Read Also: 5 Best Child Insurance Plans in India
The Plan Provides Tax Benefits-
Another benefit that is included in a child plan is that the premium paid for the child plan is exempted from tax deduction under section 80C. Similarly all the capital gains, maturity benefits and any other income from the plan is tax free under section 10(10D) of Income Tax Act. One can save bundles on taxes on the amount invested and benefits received under child’s education plan. Besides this, one also gets an opportunity to reinvest the saved amount from the taxes on any other saving instruments.
Policy Cost is Affordable-
As compared to the other child insurance plan life insurance plan for children are comparatively more affordable. The plan secures the future of the child so that he/she can get the best of everything. According to the insurance experts a child plan is structured to meet the burgeoning needs of the child. A normal term insurance plan stops if the insured person dies whereas the child plan continues to provide fund to the child in equal installments during the tenure of the policy.
Apart from providing financial stability to the child a life insurance plan offers manifolds of benefits. It provides an opportunity to the child to have a better lifestyle even if the parents are not present and successfully achieve all the important milestones of life.