LIC Child Plan: An Overview
Childbirth brings immense joy into the family and a bundle of responsibilities on the shoulders of the parents. The day when you watch your child walking with tiny paws without any support, you realise they should never fall at any step of life. As a parent, nothing can protect the child better than you. But you must have realised that financial security is as important as physical security for a child. An insurance plan for a child is a fool-proof tool to secure the future, including their education, marriage, and business necessities.
Thinking about insurance, Life Insurance Corporation of India is the prominent name you have heard in your lifetime. Are you searching for the best LIC child plan to buy? LIC of India offers a mirage of plans for individuals of different ages, including your loved child. Don’t wait anymore to safeguard your child's future with LIC Child Plan. This article will discuss the children's plans offered by LIC of India, their benefits, and how they protect your child at the vital stages of life.
Table of Content
What is LIC Child Plan?
LIC child plan is a life insurance policy that offers the financial safety of your child and a planned future with the best possible education, career choices, marriage, and backing up a number of important life events. The plan also ensures financial protection and encouragement to achieve life goals, even after the unfortunate demise of the parent. The market is volatile, so investing in stocks may not offer reliable returns, but investing in Child Plan from Life Insurance Corporation of India gives you an assured return.
Why Should You Buy a Child Plan?
The habit of saving can defend an individual from surviving the deadliest situations in life. When it comes to your child, you need to prepare for the expected stages and unexpected consequences by allocating funds through a disciplined saving habit. Investing in a LIC child insurance plan helps create a strong financial cushion. Here is the answer to why you should buy a child plan.
Financial Corpus for Your Child
Having a financial backup for your child is necessary to sustain the current lifestyle and attain remarkable future goals. The sum assured, and the accumulated benefits depend on the money you pay in the form of premiums. The payment received at the different stages of life build a monetary backup and cuts down the financial burden or stress.
Safeguard Your Child When You Aren’t Around
Life is uncertain and hits hard without any prior notice. Better for you to safeguard your loved ones to escape from any adverse effects when you are no more around to hold them. Child insurance policies offer a Waiver of the Premium Rider to waive the remaining premiums where the benefits remain in force.
Tax Benefit
The child plans offer a tax exemption on the premium paid towards the policy and the maturity benefit received. The tax benefits are provided as per the standard provision of the Income Tax Act of 1961.
Avail of Loan for Higher Education
With the skyrocketing education expenses, enrolling in a private college or university of your choice will become even more expensive. Going abroad for higher studies will be a hardship. With a child plan, you can secure a liquidity option for your child.
Attractive Source of Income for Child
Some child insurance plans provide regular income to the child after the death of the guardian. This regular income is 1% of the sum assured amount, which can help the child decrease the financial burden and plan for their future.
Benefits of Buying a Children Plan from LIC of India
Since 1956, Life Insurance Corporation of India has served a vast customer base with the most affordable and constructive plans. These plans offered by LIC ensure the secured future of a working individual or retiree and protect a child's future when they need it the most. Specific reasons mentioned below highlight why you should trust the LIC of India to buy a LIC policy for a child.
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Variety of Child Plans
LIC keeps updating its product range as per the prevailing needs of consumers. Being a parent, you only envision your child to be protected and ready for any uncertainties of life. Life Insurance Corporation of India offers various plans that can help back your child’s education and other financial goals. The company focuses on developing products to benefit society rather than earn profits.
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Your Child in Safe Hands
With over 6 Decades of following the most customer-centric approach, LIC of India has maintained the trust from its establishment. Investing in a LIC child plan can leave your child's future miseries in reliable hands. The payouts at certain intervals ensure that your child gets a good education, a secured career, and sufficient capital for business.
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High Return on Maturity
LIC Child plans offer comparatively high sum assured and returns on maturity that can be utilized as a secured future for your child. Also, some plans allow liquidity provisions to help your child set big future goals.
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Sense of Security
You will only invest your hard-earned money if you know that it is in safe hands. With the LIC Act 1956, the Life Insurance Corporation of India is backed up by the central government and guarantees to pay the return as mentioned in the policy term. So, in the most unfortunate case, when you will be no more around your child, be assured of receiving the sum assured at the pre-defined intervals.
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Technologically Advanced
In the advancement of the technological era, to help the insurance industry opt for paperless documentation, the organization uses the most advanced technology, such as WAN, IVRS, LAN, and EDMS.
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Simplified Consumer Support
Whether you purchase a LIC policy online or offline, LIC of India offers 24X7 customer support to simplify the process and solve any issue.
List of LIC Best Child Plan
Below is the list of Child Plans offered by Life Insurance Corporation of India that you can consider to plan your child's future.
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LIC’s New Children Money Back Plan |
Coverage Benefits
- Death Benefit
- Survival Benefit
- Maturity Benefit
- Participation in Profits
Eligibility Criteria
Entry Age: 0 years to 12 years
Sum Assured: Rs. 1 Lakh - No Limit
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LIC’s Jeevan Tarun |
Coverage Benefits
- Death Benefit
- Survival Benefit
- Maturity Benefit
- Participation in Profits
Eligibility Criteria
Entry Age: 90 days to 12 years
Sum Assured: Rs. 75,000 - No Limit
LIC Plans that You Can Buy For Your Child
Except for the LIC child plans mentioned above, there are some other plans that you can purchase for your child and secure a good financial corpus.
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LIC’s SIIP Plan |
Coverage Benefits
- Death Benefit
- Maturity Benefit
- Refund on Mortality Charges
- 4 Fund Types
Eligibility Criteria
Entry Age: 90 days to 65 years
Sum Assured:
Age below 55 years: 10 times of annualized premium
Age above 55 years: 7 times of annualized premium
What to Consider While Purchasing a LIC Child Policy?
The right child plan is the one that opens the doors of multiple scopes for your child in the coming future. In the era of throat-cutting competition, different insurers offer various child plans, and you need clarity on selecting the most suitable one. You can consider the following points while purchasing a child plan from LIC of India.
01
Identify Your Goals : To start investing in any plan, the first step you can consider is to identify the goals. Estimate how much you want to secure for your child's education, what your plans are for their marriage, fight a medical condition, or in simple words, what corpus can help make your child go financially independent.
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Pick an Investment Option Early : You can choose one from the above-mentioned plans that complement your investment needs. Buy a child plan as soon as the child is born so that the returns can back up the important stages of your child. Choose a plan with an affordable cost and expenses to attain the additional benefits. This way, you can invest for a more extended period to build a good corpus.
03
Check the Past Performance of the Plan: The previous performance of the plan will help you understand how much you can rely on investing. This can clearly indicate the plan’s credibility and customer support. Also, read all the terms and conditions of the child plan thoroughly and comb up all the benefits to clearly understand the working process of the policy.
04
Avail the Maximum Benefits : The LIC child plan offers multiple optional benefits to enhance coverage and prepare for every odd situation. For example, you can buy a Waiver of Premium Rider so that your child does not need to worry about paying the premium in case of your premature death. Other optional benefits are available to select on a policy anniversary during the policy term.
05
Check the Robustness and Strength of the Insurer : Before purchasing a plan, you should check the claim settlement ratio, the process, and the solvency ratio. A good company has a high claim settlement ratio ensuring a happy consumer base where the claims are settled hassle-free without any delay. While to check the financial strength of the company, go through the solvency ratio. The higher the numbers, the better the company.
How Does LIC Child Plan Work?
Being a working parent, childcare is the most significant expense you can bear. With the inflation and skyrocketing prices of essentials, it takes a lot of work to weave a quality life with just a monthly income. Cut the worry! The child plan offers multiple benefits to help you plan your child's future. Let’s understand how a LIC Child Plan work.
- Insurance and Investment : The child plans are generally designed to yield double the benefits of life cover and investment tools. Hence help you attain financial security and stay stress-free from the uncertainties of life. The returns can help secure a financial corpus for the crucial stages of your life.
- Death Benefit :On the death of the life assured during the policy term, the Sum Assured on Death is provided to the nominee with a vested simple reversionary bonus and final additional bonus (if any). The Sum Assured on Death provided is higher of
- 7 times of annualized premium, or,
- 125% of the sum assured
- Survival Benefit : If the policyholder survives the expected policy anniversary, a pre-defined percentage of the sum assured is provided. The policy provides an option to choose years at the time of the inception.
- Maturity Benefit :Suppose the policyholder survives the policy term while the policy is in force. In that case, a Sum Assured on Maturity, along with the final additional benefits and vested simple reversionary bonuses, are provided to the policyholder. This Sum Assured on Maturity is the fixed percentage of the Sum Assured.
- Participation in Profits :The policy participates in the profits of the corporation and qualifies to yield Simple Reversionary Bonuses that are rewarded over a span. A final additional bonus is also announced in case of the claim of death or maturity of the policy. For a paid-up policy, the Life Insurance Corporation of India doesn’t pay any final additional bonus.
Final Words
With the shift of time, the needs of the children are far distinct today from when we were a child. Hence, we are responsible for providing them a bright and financially sound future. You should consider investing in a child insurance plan as much as you consider investing in the stock market. A child plan from LIC of India helps you earn a profitable return to attain your child's financial security. You can use the LIC child plan calculator online to estimate the payable premium to gain maximum benefits.
Want to make an informed decision validated by the experts? We RenewBuy can help. Connect with RenewBuy POSP advisors to plan your child’s future; NOW!