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Child Plans vs Regular Term Plans: What You Should Go For?

Aug 08, 2018 | 2 years ago | Read Time: 2 minutes | By iKnowledge Team

Planning for your child’s future takes utmost priority when you plan for your investments. This is because factors like rising education cost, health care, and wedding expenses are a major of your investment plans. Hence, having a proper financial plan for your child is crucial.

You must have come across claims that say saving in term plans or regular plans are the most favourable ways to provide cover against the risk of early death. They surely are, as they provide a high cover at low prices and give out a lump sum amount in case of the policyholder’s untimely death. After this, the policy ends.

A child plan, on the other hand, provides a lump sum after the demise of the policyholder but the policy does not end there. All upcoming premiums are waived and it is the insurance company that carries on the investments on the policyholder’s behalf. From higher studies to wedding plans, a child plan will support your child’s dreams when you are not around. A child plan will be the ‘financial parent’ for your little one when he/she most needs it.

Features of A Child Plan


In child plans, you can choose to pay your premium in one go as a lump sum, at the beginning of your policy or periodically. The amount will depend on the maturity and sum assured that you have opted for.

Sum assured

After the untimely demise of the policyholder, your child insurance plan can provide a lump-sum payment to your child. After this, the insurer continues to pay the premium on behalf of the insurer until the end of the tenure. You can also choose a yearly payout to help your child financially.


Child plans are usually meant for children up to the age of 18 to 21 years. But, there are some plans that have a higher age ceiling. The tenures of child plans start from birth till a pre-defined age of the child.

Dual Benefits

With a child plan, you can get dual benefits of insurance coverage and an investment. All this rolled into one policy. It allows you to gather funds while it provides you financial protection.

Partial Withdrawals Allowed

With a child plan, you can make partial withdrawals. This ensures your financial needs are covered, in case you face any unexpected needs. You can also use this money to meet any other financial obligation.

Types of Child Insurance Plans

There are various types of child plans available in the market, and they differ across insurance providers. Based on your requirement, and the future needs of your little one you should opt for a child plan.

There are two types of child plans available:

If you go for a Regular Premium Plan, you make annual premium payments till your child turns 18 years old. After this, the insurer pays back in installments for four years.

If you go for a Single Premium Scheme, you pay a lump sum amount while purchasing the policy.

Things to Consider

  • Financial coverage offered to your child
  • Cost effective
  • Offers security for your child’s dreams (higher studies and healthcare)
  • Withdrawal conditions

Among the countless advantages of purchasing a child plan, the best and most emphasised is the financial assistance provided to your child at various stages of their life. Some of the said stages could be higher education, marriage or any other financial emergency. If you are looking out for such a plan, Aegon Life’s iMaximise Plan is your investment and insurance ally. Go ahead, and insure your child’s dreams today.

Advt. no.: II/Jul 2018/4287


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