LIC Child Plan

A child plan not only enables parents to financially secure the future of their children, but also acts as the guardian in case of the absence of the actual parent. LIC Child Insurance Plans assure parents of their ability to be a responsible provider for their children and guarantee a financially stable future.

Here are the primary features of LIC Child Plans:

• ‘Waiver of Premium’ rider, which is an in-built feature of every LIC child Plan, ensures that the insured, that is the child, becomes eligible for the pre-determined sum insured along with the accrued interest in case of the sudden death of the policyholder during the policy term. Not just that, the future premiums will be waived off, while the plan would continue as it would have had the policyholder been alive.

• The ‘deferment feature, offered with some LIC Child Plans, enables the policyholder the benefit of postponing the risk coverage to a few years after the start of the policy tenure. This is usually applicable when the child is the insured. In case of the death of the child during the deferment period, the premiums paid till date are returned because life coverage was not applicable during this term.

• The ‘vesting’ feature makes the insured child entitled to become the policyholder at a certain pre-determined age as the LIC Child Plan vests in his/her name. The vesting age is usually 18 years.

Let’s take a look at the LIC Child Plans.

LIC Jeevan Tarun Plan

The Jeevan Tarun Plan is a participating, non-linked limited premium payment plan that is a healthy mix of insurance and savings for your child’s future. It is an effective insurance plan that will enable you to fulfil his/her dreams of admission to the preferred education course, hostel charges and other expenses.

Salient features and benefits:

• It is a traditional child plan that is a blend of Endowment Plan and Money Back Plan.
• A parent or grandparent of a child between 0 and 12 years of age can become the policyholder
• There is no cap on the maximum sum assured for the plan
• Flexible premium payment options, along with a free lock-in period of up to 15 days, so as to enable the policyholder to return the policy if it does not meet his/her objectives.
• Offers LIC premium waiver benefit rider
• The loan can be availed against the plan only after it has reached a surrender value
• It includes an annual survival benefit for children between aged between 20 and 24 years. It is available in four categories ranging from 5% to 15% every 5 years on the sum assured.
• Offers maturity benefit after the policy term of a maximum of 25 years less entry age. It ranges from 25% to 100% of the sum assured. This can vary on the basis of the selected option.
• The plan becomes null and void in case of suicides during the policy term.
• Survival benefits are available under four options which can range from 5% to 15%, for the sum assured every year for 5 years.
• This survival benefit is payable annually to the policyholder, beginning from the completion of 1 year of the policy.
• Add-on rider is available on an additional premium payment.
• On the first unrepaid premium payment, the policy can be revived within 2 years on payment of discontinuance charges.
• Tax benefits are applicable under Section 80C and maturity benefits can be availed under Section 10(10D) of the Income Tax Act, 1961.

LIC New Children’s Moneyback Plan

The New Children’s Moneyback Plan is tailor-made to help your child achieve milestones like higher education, marriage, etc. by planning for the finances well in advance. It helps you to be prepared for the rising expenses involved in admissions at institutes for higher education, vocational training and other expenditures.

Salient features and benefits:

• Eligible for parents or guardians with children below 12 years of age.
• Policy term extends to a maximum of 25 years less age at entry.
• No cap is applicable on the sum insured, payable along with additional bonuses and maturity benefits
• Survival benefits are paid back along with incentives at the rate of 20%
• The premium is payable monthly or quarterly or half-yearly or yearly as per the discretion of the policyholder
• Eligible for attractive rebates on payment of high premium amounts
• Entitled to bonuses through corporation profits earned by LIC
• Eligible for tax benefit under Section 80C of the Income Tax Act, 1961
• Premium waiver rider can be availed in case of the death of the policyholder.
• Death of the policyholder during the deferment period makes the insured eligible for all the premium paid till date
• Revival of lapsed policy is possible on payment of the entire sum due within two years of the first unrepaid premium
• Loan facilities can be availed on this plan to overcome unforeseen exigencies
• The policy has a surrender option after 3 years of the start of the policy.

LIC Child Plans help in meeting your financial objectives such as securing your child’s future ambitions and aspirations. Most importantly, it safeguards his/her future even after unforeseen eventualities. It offers your family the much-needed financial support to tide over your absence and its subsequent uncertainties.

Here are some of the benefits of LIC Child Plans:

Finance your child's school fees

With a LIC Child Plan, you can be assured that your child’s education will not be interrupted even after your sudden death. In case such a scenario arises, your insurance provider pays a certain percentage of the sum assured or a lump sum immediately. Besides, it also starts offering annual pay-outs till the end of the policy tenure.

Finances higher education

The amount you will need to invest in the future towards your child’s higher education is usually difficult to predict. It depends on various parameters like the type of course that your child may like to pursue in the future, its geographical location, the rising costs of education, etc. Planning ahead when your child is very young gives you sufficient time to plan your finances efficiently. It also ensures that your child’s higher education would not get affected in case of an unfortunate event or he/she would not have to apply for a loan.

Financially support co-curricular activities

Not just school fees and higher education, co-curricular activities also help in character-building. In fact, certain child plans disburse a certain amount periodically, so that your child can pursue such activities seamlessly.

Financing your child’s wedding

Your child’s wedding would not appear to be a huge task if you plan for it in advance. If you start a LIC Child Plan in a way that you will be eligible for a lump sum when your child attains a marriageable age, arranging for the necessary finances would not feel like a burden.