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As a parent, being there for your child and enabling them to achieve their dreams, matters! That’s exactly what a good ULIP child investment plan does for you – provide the financial protection your child needs, with or without you being around. With a ULIPs at Finserv MARKETS, enjoy benefits that include free life cover, tax exemption, and the liberty to invest in funds of choice.
What is a Child Plan?
A ULIP child plan ensures that inflation or unforeseen events do not hinder your child’s future. As a parent, being there for your child and encouraging them to achieve their dreams is what matters the most! That’s exactly what a good ULIP child investment plan does for you. It provides the financial protection that your child needs even in your absence.
The ULIP child plans available on Finserv MARKETS are designed to specifically cater to your child’s education. In this child education plan, you get the dual benefit of saving and protection. You can invest in this policy based on your child’s educational needs, your financial capability, and other monetary goals, and use the funds through partial withdrawal. Moreover, you also enjoy ULIP tax benefits on such investments.
Reasons To Buy Child Plan
Reasons to Invest in ULIP Child Plans?
Features of ULIP Child Plans
The following are some salient features of the ULIP child plans available on Finserv MARKETS.
Financial Security for Children
The policy can be taken either by parents or grandparents to secure the financial future of their children or grandchildren.
Long-Term Investment
The term for a ULIP child plan is generally 10-25 years with a lock-in period of 5 years.
Dual Benefits
Since this child plan is a ULIP investment, a part of the premium goes for life insurance coverage; the remaining amount is invested in market-linked funds.
Dual Payouts
The policy offers two payouts:
The Sum Assured is paid upon the death of the insured
The fund value is paid upon the maturity of the policy
So, if the parent(s) dies or a critical illness renders him/her incompetent to provide financially for the child, the policy will:
Pay the Sum Assured to the child nominee
Waiver of future premiums
Pay fund value upon maturity
Besides securing your child’s financial future, the policy also offers ULIP tax benefits to the parent(s). They can claim tax deductions on the premium paid under Section 80C of the old income tax regime. The payout upon death/maturity is also tax-free under Section 10(10D) of the Income Tax Act, 1961.
How Does a ULIP Child Plan Work?
A ULIP child plan is purchased with the long-term intention of securing your child’s financial future. The policy works similar to that of any ULIP investment. A part of the premium paid towards the child plan is used for life insurance cover and the remaining amount is invested in market-linked funds.
In case the insured (who is a parent or grandparent of the child) dies, the insurer pays the sum assured amount under the life insurance component of the policy. Upon maturity, the policy pays the fund value under the investment component. That way, the child receives two kinds of payouts, one in the event of their parent’s death and another after policy maturity.
Eligibility and Documents Required for ULIP Child Plans
When buying ULIP child plans with us at Finserv MARKETS, check your eligibility beforehand. Also, ensure that you have the required documents handy.
Eligibility Criteria for ULIP Child Plans |
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Documents Required for ULIP Child Plans |
You will be asked to submit the following documents:
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Why Choose Finserv MARKETS for ULIP Child Plans?
Start Investing in Child Plan with Finserv MARKETS Today!
Child Education & Insurance Plans: Buy Bajaj Allianz Child Plans available on Finserv MARKETS to secure your child's future and education. ULIP Child Plans offer tax benefits, life insurance and market linked returns. Get a free quote today!
Use ULIP Calculator to Determine Returns on Child Plans
As we know, the life insurance component of your ULIP child plan provides a predetermined sum assured to the beneficiaries after your death. However, the returns on the investment component can be tricky to calculate. To make the math simple, you can use the ULIP calculator available on Finserv MARKETS.
The returns depend on the premium amount and tenure of your ULIP child plan. Follow the steps below to calculate the same.
Go to the ‘ULIP’ section on Finserv MARKETS and choose the ULIP calculator.
Enter the premium amount and the frequency of payments (monthly, quarterly, annually, lump-sum).
Choose the tenure of your ULIP child plan.
Select the funds in which you want to invest your money (debt, equity, or hybrid)
Enter personal details like age, gender, medical records, etc.
Once you submit these details, the online ULIP calculator will estimate the returns accumulated over time.
Further, we have discussed in brief about child plans in India.
Types of Child Plans in India
Child plans are designed to cover the financial future of your children, whether you are around to provide for them or not. In India, we’ve three types of child plans.
ULIP Child Plans
ULIP child plans provide dual benefits. A part of the policy premium aims to protect your children like a standard child education plan while the remaining is invested in market-linked funds. Because of this, your child receives dual payouts, one in the event of your death and another on policy maturity.
Child Savings Plans
Having a child savings plan eliminates the risk of market-linked investments. You either pay regular premiums or for a limited period to receive guaranteed payouts by the end of the policy term. These are further classified into two categories:
- Single-Premium Child Plan
- Regular Premium Child Plan
Depending on your affordability and convenience, you can choose either of them.
Traditional Child Endowment Plan
A child endowment plan is nothing but a traditional life insurance policy that offers security and savings to your children. The policy allows you to fulfil your child’s dream without having to face any financial setbacks. The premiums are invested in debt funds decided by the insurer. The maturity amount is determined based on the fund performance along with bonus payable (if any).
Factors to Consider When Investing in Child Plans
To understand how much you should invest in a child plan, it is imperative to know the importance of quality education for your children. Having a good educational background will allow your child to start a career and earn a livelihood for themselves in the future, thereby making them financially independent.
But before you decide the amount to invest in these policies, ask yourself the following questions:
What are your future financial goals?
What is your monthly income?
What are your expenses?
Do you have any savings?
Do you have any insurance plans?
Answers to these questions will help you make an informed financial decision for your child’s future.
What is Waiver of Premium Benefit in Child Plans?
Child plans in India come with an intrinsic benefit known as waiver of premium (WoP). The benefit comes in handy if you (the parent) passes away due to an unfortunate turn of events. During such dreadful and emotional times, be rest assured that your child plan will remain active as the insurer covers the remaining premiums.
Tips to Get the Best Child Plan in India
Nothing compares to the security of your child’s future. While a child plan helps you do that, the following tips will encourage you to choose the best policy.
Invest Early
It is best to start investing in your child’s future as early as possible. Doing so helps you build a substantial amount over time, giving your children more financial security. Many child plans provide milestone benefits to children when they turn 18, finish graduation, and so on. Moreover, investing in a child plan early in life, say when your child is 5 or 10 years-old, might allow you to pay off their tuition fees for higher education without taking any loan.
Factor in Inflation
Whether you are investing in a child plan or otherwise, it is essential to factor in the inflation rate. The cost of education and medical expenses are enormous. If this factor is accounted for when investing in the best child plan, you will be able to secure your child’s financial future more appropriately.
Choice of Funds
While child savings plans only allow you to invest in debt funds, ULIP child plans give you an option. A part of the ULIP child plan premium is invested in market-linked funds of your choice. These funds can be debt, equity-oriented, or a combination of the two. Depending on your risk appetite, you can proceed to invest in a fund of your choice.
Typically, people with a low-risk appetite choose to invest in debt funds, and those with a high-risk appetite invest in equity funds. So, be mindful of evaluating the risk involved with both and make an informed decision when choosing the funds.
Claim Process of ULIP Child Plans
Filing claims was never so simple. Just follow these steps and you’re done!
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1
Register your claim online
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2
Upload documents online
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3
Claim Assessment
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4
Claim Decision
- Advantages of Investing in ULIP
- Balanced funds
- Bond Funds
- Fund Switching Techniques
- Lock in period in ULIPs
- Mortality charges in ULIPs
- Myths about ULIPs
- Things to consider before buying ULIPs
- ULIP vs Mutual Funds
- ULIP vs PPF
- ULIP vs SIP
- What is ULIP?
- Why invest in ULIPs?
- ULIP tax benefits
- Type 1 and Type 2 ULIPs
- ULIP vs ELSS
- How to make a personalized investment plan
- How to choose the best ULIP plan
- Importance of Asset Allocation
- ULIP charges you should know
- Ultimate guide to ULIPs
- Importance of market linked instruments
- Evolution of ULIPs
- All about Endowment Plans
- ULIP NAV and its calculation
- Benefits of LLG
- ULIP FAQs
- ULIP fund performance
- Long Term Capital Tax on ULIPs
- Features and Benefits of Child ULIPs
- ULIP as an Investment Option
Manage all your queries here
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✔️What is a Child Investment Plan?
Being a parent, it is vital that you efficiently plan your finances to provide a secure future for your child. This is where a child investment plan comes into play. It provides you with a host of other benefits including a life insurance cover, coverage for family in your absence (death cover), and building a fund/corpus to help you meet your financial goals. Whether it is your child’s education, marriage or other important life events, Bajaj Allianz child plans can help you plan your investments and realise your dreams. -
✔️How do I differentiate between nominee and beneficiary?
The term ‘Nominee’ refers to a person whose name has been nominated by the policy holder, authorizing him/her to take the proceeds of the policy after the death of the policy holder. It is then the responsibility of the nominee to disburse the proceeds as instructed amongst all legal heirs. The term ‘beneficiary’ refers to an individual who displays financial interest towards the policy holder. This could either be a legal heir of the policy holder or a bank/financial institution that has earlier provided loans/financial assistance to the policy holder. -
✔️Do Child investment Plans enjoy tax benefits?
Yes, they do. As a matter of fact, life insurance policies are used as a tax planning tool by policy holders. The policy holder here can save on taxes under sections 80C, 80CCC of the Income Tax Act of 1961. However, the limit for the same is set at Rs. 1, 50, 000. -
✔️Who all can buy a child life policy/child plan?
Parents, grand-parents and legal guardians of the child can buy a child life investment plan. Bajaj Finserv has partnered with Bajaj Allianz to provide some of the best child investment plans to our customers. Now get all the information you need about Bajaj Allianz child plans online. Visit www.bajajfinservmarkets.in to know more. -
✔️In the unfortunate event of passing away of the proposer, what happens then?
When you opt for a Bajaj Allianz child investment plan online, you are given the option of premium waiver or payer benefit. If the policy holder passes away then, the insurance provider steps in and takes up the responsibility of all the future premiums of the child investment policy. -
✔️Is it possible for me to make a partial refund out of my fund?
Sure, you can make partial withdrawals from the fund to meet any financial emergencies. You can make lump sum withdrawals after having completed 5 policy years provided that the life assured is no less than 18 years old.
