Introduction
Child life insurance (also called baby life insurance or kids insurance) is a type of life insurance plan which is designed to insure the life of the child. It is purchased by parents to provide financial protection for their children. Usually, child insurance policy lasts for the entire life of the kids. In this post we are going to discuss some main objectives of buying child life insurance policy.
Purposes Or Objectives Of Child Life Insurance
The main objectives of child insurance can be pointed out as follows:
1. To Provide Financial Protection
One of the main objective of child insurance is to cover the needs of the child in the future that ensures safety and comfort in child's life. It also provides financial security for the family if a child passes away.
2. To Enjoy Tax Benefit
Child insurance premiums are tax deductible in many countries that helps to lower the taxable income. So, it provides tax benefit.
3. Long-term Coverage
Another purpose of buying child life insurance is to get long-term insurance coverage. Generally, kids policies can be converted into whole life insurance that provides permanent coverage.
4. Huge Maturity Benefit
Insurance companies provide huge maturity benefit in a lump sum after the maturity period. It helps to secure child's future.
5. Peace Of Mind
Child life insurance offers peace of mind to guardians because they know their children are financially safe because it secures the future of the child.
Also Read
Advantages and disadvantages of child life insurance
Main features of child insurance plan
6. Lower Rate Of Premium
Child life insurance premiums are relatively lower and affordable than other types of life insurance plans for adults. So, it is cost effective than other insurance policies.
7. Premium Waiver Benefit
Child insurance premiums are waived off in case of the death of the policyholder.