In today’s extravagant standard of living and ever rising cost of commodities it is very essential to foresee the future and secure a promising future for yourself and your family. Just like our parents carried out their family responsibilities and fulfilled their duties without complaining it is our responsibility to secure a plan for our children’s future. One such step towards securing a well settled future is to invest your money into insurance plans from which you can reap maximum benefits in the times to come.
Once we have a family we strive hard to keep everyone happy and take care of the basic necessities. But to think of it, you never know what to expect in the future. How will you be ten years from now? Would you be well fit to work as hard as you working now? What about unexpected accidents or mishaps? It is scary, isn’t it? Our kids are our future. So we need to take necessary steps to handle and set up things now, that might take some unwanted burden off their shoulders in the future. For this same reason we have got child insurance plans.
If you have chalked out what your child might become professionally in future you may also be aware of the kind of funding required for the same. These are ages of increasing economy as well as rising cost of living by the second. So it is wise to invest in the best plans available that would assure you returns after more than 10 years of investment. With a surfeit amount of child insurance plans available in the market today, it becomes an heavy task for the concerned parents to effectively choose the best plan for their children. They need to understand the fundamentals and dynamics of planning for their children’s future in order to choose from the best available alternatives.
At present the top selling child insurance plans are- Smart Kid by ICICI, Unit Linked Young Star Plus by HDFC, Child Dream Plan by BIRLA and Head start Future Project by KOTAK. All these four policies provide death benefit except HDFC that provides an option viz. a death benefit option and a critical illness benefit. In the unfortunate event of a death of a parent, ICICI, BIRLA and HDFC will make a bulk payment of the amount assured to the nominee and the policy will continue with the insurance company contributing future premiums till maturity. Whereas in KOTAK at the event of death of a parent they would pay the nominee the sum assured as well as the unpaid premiums and the policy would fail to continue thereafter. This would be a disadvantage over the other plans because the entire amount is released on a date that is not what was planned for.
Costs incurred is also to be considered here, where BIRLA has the lowest allocation charges, it also has very high policy administration charges that adds up to the same any which way. On the contrary, The Smart Kid policy by ICICI seems to have a comparatively lower allocation charge which comes upto 20% in the first year as opposed to the more atrocious 60% of the first year of premium by HDFC. The administration charge in other policies is minimal compared to BIRLA. BIRLA also does not provide easily understandable policy brochures.
From a lot of research on the various plans it has come to conclusion that the Smart Kid plan offered by ICICI is the most cost effective. Their catalogs are very transparent and most of their charges are considerably lower compared to the other plans.
Insurance Plans claimed to be best here, may not be best for every person. Please consult experts for accurate advise.
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