Several types of insurance plans are available for individuals according to their unique needs and benefits within the policy term. Term insurance is a popular type of insurance policy that provides financial security for the family members of the policyholder if he or she dies within the term of the policy which can be between 5 to 40 years. The important features that make best-term insurance for individuals will be discussed and analysed below.  The concept of child policy in life insurance plans will also be discussed considering its features and importance for parents.

Meaning of Term Insurance

Term insurance is a life insurance policy that provides financial coverage and security for policyholders and beneficiaries for specific periods such as 5 years 10 years 30 years etc. Term insurance provides financial leverage for beneficiaries if the policyholder dies within the specific duration of the policy. Several types of term insurance policies allow individuals to level premiums throughout a policy along with the option of conversion into permanent Life Insurance.  Individuals can select a type of term insurance based on their requirements such as endowment policy, child policy, ULIP, etc.

Features of Best-Term Insurance

• The best term insurance is the plan that provides multiple benefits as well as pay-out options for the beneficiaries without creating stress on the family.
• The best term insurance should provide critical illness coverage in life coverage options to support the health and medical conditions of the loved ones like a Child Policy.
• The best term insurance has the feature of providing tax benefits that help policyholders utilise their taxable income as an investment for financial security.
• The features of best term insurance include flexibility of premium payment along with the option of selecting preferable tenure such as a term insurance policy.
• The features of best-term insurance include accidental death and disability coverage and a focus on minimising lifestyle risks.
• The best term insurance provides waiver and Rider options with affordable premium options with a broad range of maturity benefits.
• The best term insurance should support the financial obligations of policyholders and also help them to develop wealth such as investment opportunities.

What is a Child Policy?

A child policy or Child insurance plan can be defined as an investment plan that offers financial safety for the dreams and goals of children of policyholders by life insurance companies. Child policy is a smart financial decision for individuals wanting to secure the career and future life of their children such as higher education and marriage.  A child policy offers security for the children of the policyholder in unexpected as well as expected events of the child’s life stage and maintains a balance between earnings and spending on the child’s future.  Child policy is a type of child-specific financial product that includes the financial security of education and other important aspects of children.

Features of a Child Policy

Guaranteed support for children’s goals: A child policy is a valuable insurance plan that covers the cost of future goals of the children of the policyholder. Policyholders can simply secure the future of children by addressing the cost of education and marriage in case of their untimely death.

Growth of wealth: Child policy offers the option of wealth generation in the form of investment.  Child policy helps individuals to invest a part of a premium amount in the market products that can increase the wealth for beneficiaries based on increasing share prices which ensures capital guarantee.

Tax management: Child policy allows people to maintain taxable income more efficiently because investment in an insurance policy provides tax benefits under section 80C of the Indian Constitution which supports better savings.

Premium waiver benefit: The premium waiver benefit is one of the alluring features of child policy which is the premium payments expected by the policyholder in future are waived off by the insurance company under certain conditions like critical illness or death and eliminate the stress of premium from beneficiaries.

The accurate time to buy a Child Policy?

A child policy works more like an investment that needs a decent time to achieve growth and provide benefits. The longer-term child policy is equal to Greater benefits for the children at the time of maturity. Hence, the most accurate time to buy a child policy is with the birth time of children. The investment in a child policy at the time of childbirth achieves efficient growth of money that can support the complete education of children including graduation and post-graduation. Asil a child policy is a long-term investment it provides a strong Corpus for the children when they turn 18.

How to select suitable Child Policy

• To select an appropriate child policy it is important to evaluate related goals and age of the child. Individuals need to determine the sum of money they want to keep aside for a child’s education or future.
• Potential policyholders can select between two major types of child policy; guaranteed plans and ULIP. The guaranteed plan is a safer option however ULIP offers higher investment options.
• Buying a child policy, it is important to realise the payout methods and select the suitable one.
• It is also important to determine the claim settlement process related to child policy and other ratios or individuals can also utilise a term plan calculator.

Eligibility criteria for a Child Policy

People can buy a Child Policy at the time of child birth however the common age range of the buyers of a child policy is between 18 to 21 years with the policy maturity age between 60-65 years. In a child policy, the child or children are insured for insurance benefits, and the parents are policyholders or investors.

Conclusion

To conclude, the best term insurance is the policy that provides broad benefits to the insured with a hassle-free claim process and complete protection from financial obligations. It is also determined that a child policy is a great investment opportunity for parents or guardians to secure children’s future goals and lives in the untimely demise of an earning person or policyholder.