Here How You Can Secure Your Kids Future Before They are all Grown Up

2024-08-02

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For most parents, it is a source of worry to contemplate what would happen to their families, especially their children, in their absence. The cost of education has been consistently rising in the last decade and this has become a concern for many Indian parents. Rising retail inflation is also a cause for worry for many Indian parents who want to ensure a financially secure and airtight future for their children.

This is where life insurance can step in. Life insurance plans such as ULIPs (Unit Linked Insurance Plans) provide a lump sum payment in the event the policyholder dies. That is, children continually get the money allocated according to the terms of the policy. Such plans ensure that children are taken care of in the absence of their children and their future plans are not hampered cause of parental death.

What is a Unit Linked Insurance Plan?

ULIP is a life insurance plan that enables individuals to have the combined benefits of insurance and investment in market instruments. This plan integrates both protection and investment in its features and can be customized based on the particular needs of the policyholder. ULIPs were first brought to India by Unit Trust of India in 1971.

Today the majority of life insurance plans offer products at affordable pricing and multiple features. This can enable policyholders to attain maximum returns on their investments along with insurance coverage.

ULIPs from Canara HSBC offer individuals with plans for fulfilling their goals for their children. For example, with the Invest 4G ULIP Plan, you can make the most of your policy with perks like flexible fund options, a variety of plan payouts, loyalty additions and wealth boosters, return of mortality charges and much, much more. This plan can be considered as a long term investment to protect your children's future. Following are some of the benefits associated with this plan in detail:

Flexibility:

With the Invest 4G plan, you can switch between equity, debt funds or a combination of both. You can redirect your investments to align with the market’s highs and lows and ensure your child benefits from the highest of returns.

Choose from 7 different fund options: As per your investment horizon and risk intake, you can choose from 7 different fund options, such as: Emerging Leaders Equity Fund, India Multi-Cap Equity Fund, Equity II Fund, Growth Plus Fund, Balanced Plus Fund, Debt Fund, Liquid Fund.
Multiple Portfolio Management Options You can customize your plan as per your child’s current needs and future financial goals. You can take your pick of the litter with 4 different portfolio management options. The four options are: Systematic Transfer Option, Return Protector Option, Auto Funds Rebalancing Option, Safety Switch Option.

Plan Payouts

As your child grows, so would, in many cases, their needs. Thus, you may require financial assistance constantly at certain intervals. In such cases, you can take advantage of ULIPs’ partial withdrawals and settlement options.

Partial Withdrawals In order to meet your child’s evolving needs and unplanned contingencies, you can make partial withdrawals from your fund.
Settlement Option You can now choose to receive your maturity benefits in installments, as per the frequency of your choice.

Insurance Component

Having a contingency plan in the event of your absence is crucial. To ensure your child has the means to reach their potential, even in the face of your unfortunate demise, ULIPs offer a life insurance component. While a portion of your premiums is dedicated to investing in market instruments, another is used towards your life insurance policy.

Tax Benefits

ULIPs come with a rare EEE (Exempt-Exempt-Exempt) status. This means that everything from the principal investment amount to the accumulated returns and the maturity proceeds are all tax free. This gives ULIPs an edge over mutual funds, which are subject to the LTCG (Long Term Capital Gains) tax, while ULIPs are exempted.

Conclusion

While choosing a ULIP for your child, you should ensure maximum flexibility in fund management, an optimum amount of insurance coverage and flexible payout options. The best ULIP provide great investment options for market linked funds that eventually led to better returns. These funds can contribute greatly to fulfilling the insured individuals children's dreams, that could range anywhere between education related expenses to marriage costs.

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We bring you a collection of popular Canara HSBC life insurance plans. Forget the dusty brochures and endless offline visits! Dive into the features of our top-selling online insurance plans and buy the one that meets your goals and requirements. You and your wallet will be thankful in the future as we brighten up your financial future with these plans.