Checklist to Fully Insure Your Child with Child Insurance

Checklist to Fully Insure Your Child with Child Insurance

Once the little bundle of joy steps into your world, responsibilities grow as well. As a parent, it doesn’t end with just raising the child well. Adding to that is providing him/her with a financial safety net at every step of life. This is where child insurance comes into play. Child insurance helps in taking care of his/her well-being and supporting his/her academic and personal goals. As a new parent, it might seem pretty difficult to choose the right insurance instruments. But what if you get a checklist for child insurance plans?
 

The Three Priority Picks
 

The joy of raising a child is unparalleled. But to ensure that your little one stays protected from the hardships of life, picking the right insurances is the need of the hour. So, let's focus on the child insurance checklist, which suggests the three priority choices.

1. Term insurance:
 

A term insurance policy is specifically designed to financially safeguard your loved ones in case you're met with life's unfortunate circumstances. A pure protection term plan thus enters the checklist of child insurance plans as it pays a lumpsum or a periodical death benefit depending upon the plan and option chosen to the child nominee if the life assured parent is unfortunately no more. This money can then be utilized by the family to carry on with their life and the child’s education and build a corpus for future goals^[1].
 

2. Health insurance:
 

Not many think of buying child health insurance while planning financial protection for their little one^[2]. But as a parent you can  make child health insurance a part of the child insurance plans checklist. Children fall ill, suffer from injuries, and require regular health check-ups or vaccinations. Having a child-specific health insurance plan can help you with these expenses. If you are not keen to buy a separate plan for your child^[1], you could always extend the coverage of the family plan to him/her.
 

3. Child plan:

Mere savings may not be sufficient to build a corpus for your child’s future goals. The way inflation is showing a constant upward movement, you may need to grow your money with a solid insurance plan. This is where the child based insurance plans enter the checklist for child insurance plans. Combining the life insurance and investment component, a child based insurance plan is designed to safeguard your little one from the unforeseen crisis and grow  wealth through a single instrument. These plans are majorly of two types: traditional life insurance with low-risk maturity benefits and child based ULIPs with returns at maturity through investment in market-linked funds. However, the uniqueness of these plans is that they remain active even after paying the death benefit in the event of the unforeseen. The remaining premiums are waived off while the maturity benefit is paid when the policy expires^[1].
 

Last but not least

Having a checklist of child insurance plans may save you from unnecessary troubles and worries. But before that, remember to make a strategic move. Here’s what you can do:

• Set the specific goals you want to cover with the child insurance plans.
• Calculate beforehand how much you can afford, so that you don’t falter on premium payment.
• Every child has his/her specific needs. Do thorough research and find the best-fit plans that suit those needs.
• Start early to enjoy bigger benefits from the power of compounding.
• Take inflation into consideration while making a plan.
• Remember to choose the premium waiver option in your child insurance plans.
• Keep reviewing the child plans to optimize the investment returns.