What are child plans?
Child plan are investment options that are done keeping the future financial needs of child in mind. These plans are general taken in the name of child and the parent is just the custodian and responsible for the premium payments. In these plans the insurance is of the child’s life. The maturity benefit or the payment is made to the child directly.
What is different in child plans from other plans?
Child plans have maturity when the child would need some kind of financial support i.e. higher education, foreign travel, settling up of business, marriage, etc.
- Life insurance
- Fixed maturity
Are child plans just emotionally motivated concepts?
All investment planning concept are directly or indirectly emotions driven. We all need finances all our lives and more at certain stages of life, hence the concept of saving and investing.
LIC Child Plans
Jeevan Tarun (table 934): The only real child plan from LIC of India. The plan has all the features of a child insurance plan like
- The child get life cover
- Comes with PWB premium waiver benefit, all premium are waived off in case of death of the parent but the policy continues.
- The maturity of the policy happens when the child is 25 years old irrespective of when the policy was taken.
Jeevan Lakshya (table 933): A plan that assures a maturity at a fixed time. The policy assures the child allows an amount at the time of policy term whether the parent is live or not. In case of death of the policy holder the child also gets yearly payout till policy matures.
Jeevan Umang (table 945): a unique plan that gives out regular yearly payouts for life. The policy also has insurance cover that increases with time and continues till the child is 100 years old.