Should you buy LIC new children money back plan
LIC new children’s money back plan is an insurance cum investment plan which offers life cover and secures the financial leads of the child till they turn 25 years. Because it is a participating plan, the plan is eligible for a bonus depending on the performance of the LIC
This LIC new children’s money back plan is specially designed to meet the educational, marriage, and other needs of the growing children through survival benefits payments. Additionally, it also provides this cover on child’s life during the policy term.
LIC New Children Money Back Plan
How LIC New CHILDREN Money back Plan works
New LIC new children’s money back plan will provide 20% of basic sum assured at the age of 18 years 20 years 22 years for the child ud add rest 40% of basic sum assured along with bonus and final additional bonus will be paid at maturity
Death benefit
In the event of unfortunate death of the life assured ( Child is life assured) before the commencement of risk the premium amount paid till date will be refunded back to the nominee excluding taxes extra premium and rider premium.
After the date of commencement of the risk- the sum assured on death along with a simple reversionary bonus and final additional bonus will be payable along with the sum assured.
Here Sum assured is defined as higher of basic sum assured or 7 times of annualized premium the death. The benefit shall not be less than 105 % of total previous paid up to date of death.
Should you buy LIC new children’s money back plan?
If you understand that how LIC new children money back plan works then I am sure as a parent no one would never ever like to buy such a pathetic and meaningless plan because here the life to be assured is the child and nobody would like to have death benefit from the child death.
If you have opted for a premium waiver benefit then in case of the death of the parent the child I will not have to pay the premium and will receive the survival benefit as promised by LIC.
Here if you like to buy the plan for the child’s education and marriage expenses. I think here 20% of Corpus will not solve any purpose because education inflation ( cost of education expenses) is definitely in the range of 10 to 15%.
As you also know the cost of higher education is increasing each year. Tuition, books, and other expenses are increasing day by day and LIC plans will generate returns of around 5 to 6 % or at the max 7%, which will not solve the objective of securing the kids’ future.
Thus it’s better to ignore this plan. if you want to know more about how to plan your children’s education then please read the post.
