As a parent, there’s no way you would want to compromise on your children’s future, especially their education. Investing in a child plan, therefore, helps you plan ahead, to ensure that your child is secure, come what may. There are several child plans on offer, from market-linked and traditional plans to plans with regular payouts and lump sum payouts among many others. You can take your pick depending on your specific requirements after weighing in the different premiums and benefits.
Types of child plans from Bajaj Allianz Life Insurance
The company primarily offers two types of child insurance plans.
Traditional plans: Under this plan, the payout amount is guaranteed with investments in low yielding products and stable returns.
ULIPS: Under this plan, investments are made into equity markets over a period of time. Consequently, there are higher returns. You can, however, choose to invest in debt instruments, which is akin to traditional plans.
Bajaj Allianz Young Assure
This is a traditional, participating, regular and limited premium payment endowment plan. Bajaj Allianz Young Assure plan ensures customization of your requirements. The policy allows you to choose your premium payment term, payment frequency and guaranteed maturity benefit. The premium offered will be based on your guaranteed maturity benefit, policy term, age, and premium payment term and payment frequency. You can also choose the cash instalment option. In the case of accidental permanent total disability of the life assured, the plan will be changed to a paid-up policy. All future guaranteed additions, terminal bonus and the vested bonus will be paid. The maturity benefit will be payable at the end of the policy term.
The plan can be surrendered at any time, provided one year’s premium has been paid (if the policy term is under 10 years) or if two years’ premium has been paid (if the policy term is 10 years or above). The surrender value will be higher than the Special Surrender Value (SSV) and Guaranteed Surrender Value (GSV).
Why you should opt for Bajaj Allianz Young Assure
One of the major life Insurance companies in India, Bajaj Allianz Life Insurance Co. Ltd. is a joint venture between Bajaj Finserv Ltd and Allianz SE and began its operations in 2001. It has been in operation for well over a decade.
- Bajaj Allianz Young Assure Plan is one of the life insurance products offered by the company. The salient features of the plan are as follows:
- It is a traditional participating child insurance plan, ie, the benefits depend on the performance of the participating fund.
- It has two premium paying options- regular (customers have to pay throughout the policy term) and limited.
- Customers get to choose the Guaranteed Maturity Benefit (GMB).
- Under this plan, the premium is calculated based on age, policy term and premium payment term.
- Every year the customer gets a bonus as a percentage of GMB.
- Maturity benefits are divided across a specific period of time, anywhere from 3 to 7 years.
- Customers may get a terminal bonus at the end of the payout term.
- If the policyholder dies, the child will get the death benefit immediately. Also, Bajaj Allianz will pay the remaining premiums. As a result, the maturity benefits are not affected.
- The sum assured is usually ten times the annual premium.
- The insurer will pay future premiums on behalf of the policyholder in case of accidental disability benefit.
- The maturity benefits include Guaranteed Maturity Benefit (GMB), Guaranteed Additions, Interim Bonus, Vested Bonus plus and Terminal Bonus.
- Customers can take the maturity benefit as per cash installment options chosen. The first installment will be paid from the end of the policy term.
If you are looking for a traditional savings plan with benefits such as guaranteed pay-out amount and stable returns, Bajaj Allianz Young Assure plan might just fit the bill. It includes several benefits including waiver of premium (death benefit), which ensures that the maturity corpus is not affected. Nevertheless, these plans offer a return of only 4 to 6%. If you are looking for higher returns, you could opt for a similar plan using a term plan.
- Offers three cash installment options to customers.
- Offers multiple premium payment and policy term options.
- Offers wide coverage in case of accidental disability or death.
- Offers Guaranteed Maturity Benefit (GMB), Guaranteed Additions (GA) and bonuses.
- Under this plan, female policyholders get special rates.
- The maturity benefit will be payable at the end of the policy term.
- Customers can upgrade insurance coverage with riders.
- The sum assured on death (guaranteed death benefit of 105% of premium paid till death) will be paid. As a result, the plan will be changed to a fully paid-up policy wherein all future guaranteed additions, vested and terminal bonus will continue to accrue.
- The plan offers a premium rebate if chosen GMB is higher than Rs. 1 lakh.
- Premiums paid are eligible for tax benefits under section 80C of the Income Tax Act.
- Maturity benefit, death and surrender benefits are eligible for tax benefits under section 10 D of the Income Tax Act.
If the life assured commits suicide, the company’s liability will be limited to the following clauses
- If the life assured dies within one year from the date of commencement of risk with 80% of the premium paid.
- If the date of death is within one year from the date of the latest revival, higher of 80% of premiums paid till the date of death or surrender value.
The accidental permanent total disability will not be payable in some cases as follows:
- Disability as a result of breach of law with criminal intent, war, invasion, riot, under the influence of alcohol or drugs, naval/military/air force operation, hazardous sport and poison among others.
Madhavi, a 30-year-old software executive, has a Bajaj Allianz Young Assure for her one-year-old son Arjun. Madhavi opted for a 20-year policy term with a premium paying term of 15 years. Madhavi chose a Guaranteed Maturity Benefit (GMB) of Rs.3,00,000. She, therefore, pays a premium of Rs.24,363 p.a. Madhavi also chose a cash installment option of 5 years for her son. Madhavi’s sum assured (10 times of annualised premium) is Rs. 2,43,630. On maturity, Madhavi will receive cash installment of Rs. 4,21,833 (investment return of 8% for 5 years).
How to choose the best option
There are a slew of child insurance plans offered by several insurance companies in the country. Choosing the right child insurance plan, therefore, requires a comparative analysis of several plans including benefits and caveats. It is here that BankBazaar.com steps in to make your search not only easier and simpler but also sharp and comprehensive. Browse through our pages to understand all about child insurance plans. We are dedicated to keep you abreast of the latest on insurance products.
Get the details of Bajaj Allianz child Plans insurance at BankBazaar, and help your children to live their dreams.
GST of 18% is applicable on life insurance effective from the 1st of July, 2017