Life Insurance - Secure Children's Future - HDFC Bank
Table of Contents
Almost every insurance company in the market today offers a child insurance plan which is a unique plan designed specifically for the child’s benefit. This plan aims to create a stable future of the child in terms of finance which will remain unaffected by the presence of the parent.
These plans have some common features and promise some unique benefits which are highlighted in the following points:
The plan can be bought only by a parent who has a minor child for whom he would like to plan. Other individuals cannot buy the plan. HDFC offers two HDFC child plans
These plans cover the life of the parent and he is also the person responsible for paying the premiums. Some plans, however, also cover the life of the child while the parent is supposed to pay the premiums and is called the policyholder.
Child insurance plans can be offered as a traditional plan where the benefits payable on death or maturity is fixed or a unit linked insurance plan where the benefits payable will depend on the growth experienced in the capital market. This is because the premiums are invested in funds representing the capital market and so the growth is market related. One of the HDFC child plan is an ULIP while the other HDFC child plan is a traditional product
Unlike other plans of insurance, a child plan will have an inbuilt benefit of the waiver of premium rider. This rider ensures the continuation of premium even after the policyholder who is responsible for premium payments dies. So, the child, who might be the life insured or the beneficiary will not have to worry about paying premiums if the parent dies because the company will take care of the same.
Normal maturity benefits are payable if the policyholder survives till maturity. However, on death two things happen. One, an immediate death benefit is paid to the nominee. Two, the plan still continues and the premiums are paid by the insurance company on every due date. When the plan matures, the maturity benefit is paid again to the nominee and then the plan is completed. HDFC child plan helps the policyholder to get maximum maturity benefits and also take advantage of various payout options under these HDFC child plans.
If the child’s life is insured, the insurance company does not take the risk immediately since inception. There is a few years’ wait which is called the deferment period during which the Sum Assured cover is not provided on the child’s life. If the child dies only the total premiums paid till the child’s death are returned to the policyholder, i.e. the parent.
Another feature in case where the child is covered is the vesting of the policy. Vesting means transfer of ownership of the policy. Since, the child being a minor cannot have the title to the policy, the parent acts as the policyholder. But, after the child attains 18 years of age, he is legally matured and then the policy ownership transfers in his name automatically making him the policyholder.
Applying for a Child Plan From The Company
Online
The company offers specific plans which are available online only. The customer only needs to log into the company’s website, choose the required HDFC child plan, choose the coverage and provide the details. The premium will be determined using the filled details. The customer then needs to pay the premium online through credit card, debit card or net banking facilities and the policy will be issued
Intermediaries
HDFC child plans which are not available online can be purchased from agents, brokers, banks, etc. where the intermediaries help with the application process.
Conclusion
HDFC Life's Plans encompass child insurance plans and education policies. They provide the ideal combo of protection and savings thanks to the many features of these children's plans and make them perfect birthday gifts for your child.
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