With the high inflation rates causing the overall price levels to skyrocket every year, the cost of education is going up significantly as well. Providing for children’s education has become a big challenge for the parents due to this.
The Effect of Rising costs on Children’s Education
As soon as their child starts growing up, most parents start thinking about getting their children admitted into big colleges for their higher education to strengthen the child future. Many of them even start thinking about sending them abroad to get them educated in premier ivy league colleges. What many parents don’t think about is the cost involved.
Whether the child studies in India or goes abroad, one thing is certain: the parents have to be prepared to spend heavily Ton the child’s admission fees, tuition fees, hostel fees, etc. Due to the rising price levels, the cost of higher education in almost every stream has already gone up significantly. Imagine what the cost will be after almost two decades when the child grows up!
Unless they plan carefully for the future, meeting the expenditure on higher education and other needs of the children will become impossible for most parents. This can have disastrous effects on the child, including the possibility of the child not being able to pursue her dreams when she grows up, due to the shortage of money. As a result, she will feel deprived, and may even blame you for this throughout her life.
To avoid such a situation, the parents need to plan early to meet the future requirements of the child and preferably should start right after the child is born. Unless the child is brilliant and secures a scholarship, higher education cost is one aspect at every parent has to face, sooner or later.
The solution: Child Insurance Plans
The best way to plan for the children’s needs is to buy a child insurance plan. These plans are designed to provide a lump sum amount when the child grows up. This money can be used to provide for the various needs of the child when she grows up.
Apart from this, child insurance plans provide a life insurance cover to the policyholder throughout the term of the plan and can be extended for up to 7 years thereafter. If the policyholder expires during the premium paying years, then the child will get a lump sum payment on account of the life cover. Not only this, the premium for the remaining years will be waived off by the insurance company but the policy will continue to remain valid until maturity.
Child insurance policies are sold by every nationalized and private insurance company in India. They offer a range of policies with different features and benefits. You can choose a child insurance policy from the variety of options available based on certain critical points.
Points to consider while buying child insurance plans
A lack of insurance education in India make it very difficult for most parents to choose the right child insurance policy for their children. Here are some of the points that they need to consider while evaluating the various child insurance plans that are available in the market today.
- Fund requirement: Before you buy the child insurance plan, the first thing that you need to do is to calculate the amount that you will need when she grow up. You will need to select an insurance policy that will provide you at least this amount on maturity.
- Policy term: This refers to the duration of which the insurance cover will remain valid. The insurance company protects the policyholder throughout the policy term. Choose a policy term which is enough to cover the child till she grows up.
- Premium paying term: When you buy a child insurance plan, you will have to pay insurance for a certain number of years. Check whether the plan offers a premium waiver facility as mentioned already. Buy a plan which waives off the premium for the remaining policy term if the policyholder dies during the tenure of the policy.
- Total benefits: Child insurance plans provide both life insurance cover and fund accumulation for the child. This is known as the total benefit provided by the life insurance policy. Always look for a plan which provides higher total benefits.
- Sum assured: The sum assured refers to the total life insurance cover that is included in the policy. Again, the higher this is, the better.
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If you want your child to be successful when she grows up, you have to provide the necessary foundation to secure the child future. Buy a child insurance plan to provide that foundation. Taking a child insurance plan is no longer an option for the parents; It has become a necessity and is a critical component of successful parenting which no one can ignore.