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Every parent wants to provide quality education for their child. A Child Education Plan helps you systematically build a fund corpus and offers life Read more cover. The plan combines savings with insurance benefits, offering life cover, waiver of premium, and maturity benefits. With a Child Education Plan, you can stay financially prepared to support your child’s education and secure their future. Read less
Every parent wants to provide quality education for their child. A Child Education Read more Plan helps you systematically build a fund corpus and offers life cover. The plan combines savings with insurance benefits, offering life cover, waiver of premium, and maturity benefits. With a Child Education Plan, you can stay financially prepared to support your child’s education and secure their future. Read less
A child education plan is a type of child insurance plan that combines protection and savings. It allows parents to secure funds for future education expenses while also offering life cover for child security. The plan works by building a financial corpus over the years, which is used for higher studies or career needs. Features like waiver of premium help ensure that the plan continues even after a parent’s demise. A maturity benefit is provided at the end of the policy term to cover rising costs.
A child insurance plan works through regular premium payments made by the parent over the chosen term. These premiums are invested by the insurer to create a fund for the child’s future needs. If the parent passes away during the policy, the insurer provides financial support according to the plan’s terms. At the end of the policy, the child receives the accumulated value to meet education or career-related expenses.
Like any other service or commodity in today’s time, quality education has become quite expensive and is still not affordable for many people. This becomes a problem since getting a good education becomes difficult for many children who are keen to learn and grow. Parents can choose to use their savings funds to educate their children but risk losing their financial emergency fund.
This is why an insurance policy for children has become important. With such a policy, parents can plan and save for their children’s education so that there are no shortcomings when it comes to giving their children the best education.
The importance of life insurance cover in child plans is as follows:
The following are the key features of child education plans.
A child education insurance plan provides both life cover and an investment component, helping parents create funds for future education while maintaining financial security.
At the end of the policy term, the child receives a maturity benefit that can be used to manage higher education expenses or other academic goals.
Parents have the choice to receive the payout either as a lump sum or through regular instalments, depending on the child’s study requirements.
Since child insurance plans are meant to provide maximum benefits to the child, the tax3 benefits of child education plans come under the E-E-E (exempt- exempt- exempt) category. This enables the insured to claim tax3 benefits on the premiums paid towards the policy as well as on the maturity proceeds paid out for the child’s education, lifestyle, and emergency needs.
The policy terms and the premium payment terms under an insurance policy for education are varied. You can choose a sum assured to further ensure that the plan is customised as per your child’s needs. Depending on your child’s future plans and aspirations, you can plan the policy such that the benefits are paid out when the child needs them.
The table below highlights how tax3 benefits apply to a child education investment plan under Indian law.
Tax benefit type |
Explanation |
Premium deduction (Section 80C) |
You can claim deductions up to ₹1.5 lakh per year on the premiums you pay for the child insurance plan under Section 80C of the Income Tax Act. |
Tax-free maturity proceeds (Section 10(10D)) |
The proceeds you receive, whether as income or maturity benefit from the plan, are tax-free under Section 10(10D) of the Income Tax Act |
The types of child education plans are as follows.
Money-back child plans provide periodic payouts during the policy term without affecting other benefits under the plan. Along with these survival payouts, the maturity amount is paid at the end of the term, and in case of the insured’s death, the child is supported through a waiver of premium benefit. This plan is useful for covering education fees or other expenses before the maturity benefit is received.
Unit-Linked Insurance Plans (ULIPs) are market-linked child insurance plans where investment returns depend on market performance. These plans allow partial withdrawals before maturity and may provide higher returns, but it is important to understand their workings before selecting one to secure your child’s future.
Endowment or child education endowment plans provide a lump sum on maturity along with any applicable bonuses. These plans are designed to suit a child’s future needs, offering guaranteed2 returns and flexible sum assured options to ensure adequate coverage for the child’s educational requirements. 2T&C apply
There is a range of child insurance plans available. To get a good child education plan, as per your needs, here are some of the factors you will need to consider.
When selecting the best child education plan, consider the following factors.
In case of an unfortunate event, if the parent passes away, the life insurance policy will pay out a lump sum amount to ensure that the child is able to continue their education even in the absence of the premium payments resulting from the parent’s death. This tax# free amount can pay off the fees and any pending debts so that the child’s education doesn’t not stop.
The rate of inflation in education sector has been significantly higher, at around 11-12 per cent9. Suppose your child wants to pursue their education in a good school; immediately making such arrangements will compromise your emergency savings. Hence, it is better to opt for a child education insurance policy that can pay for the tuition fees of your child, no matter which educational institution they choose.
If you get a good life insurance education plan for your child well in advance, it can help you get them admitted to a renowned university if you want them to pursue their further education abroad. Specialised courses can be really expensive, but with the help of a good insurance policy for education, these expenses can be covered.
Depending on the type of policy and the sum assured you choose, a life insurance education plan for your child can offer sufficient funds needed for your child’s educational needs. Be it tuition fees or additional coaching, the plan ensures that your child has everything they need!
A child insurance plan can offer a provision for making partial withdrawals or offer payouts in the event of a health emergency, such as sickness or an accident leading to hospitalisation and the need for medical care. Such a benefit may come in the form of an optional rider or an inbuilt plan feature.
Once the policy reaches maturity, the child will be able to receive the maturity benefit as a lump sum amount as specified during the policy purchase. In addition, if the parent (the insured) passes away during the policy term, not only will the premiums be waived off (if a waiver of premium option is chosen), but a regular income option can also be offered to the child.
If your child opts for higher education at a good university in India or abroad, the expenses may exceed your savings funds. However, a child insurance plan can help you out as it acts as collateral if you want to secure an education loan to fulfil your child’s higher education needs.
Child insurance policies offer several options when it comes to the policy terms and premium payment terms under the plan. You can choose to pay the premiums at regular intervals or also opt for a limited pay plan. There is also flexibility in choosing the premium payment mode – annually, semi-annually, quarterly, or monthly.
The advantages of early planning for child’s education are as follows:
Starting a child education plan early allows parents to contribute gradually over time. Even small contributions can accumulate into a significant fund by the time the child reaches higher education, which helps ensure financial security.
By investing early, parents can avoid making large, sudden contributions later. Steady, long-term contributions help manage finances effectively while ensuring the child’s education fund grows as planned.
Early planning provides the flexibility to compare different child education plans. Parents can assess features, returns, and benefits carefully to choose a plan that aligns with their financial objectives and the child’s educational requirements.
Education expenses tend to increase over time. Early investment helps parents plan for inflation, ensuring the accumulated corpus is sufficient to cover future academic fees.
Engaging children in discussions about saving and planning helps them understand the importance of financial discipline, developing responsibility from an early age.
The suitable coverage for the child life insurance plan you choose should depend on your child’s needs. For one, understand how the cost of education, healthcare, and other lifestyle aspects are on the rise. This should help you understand how inflation plays an important role in your current savings and investments towards the child insurance plan.
To get quality facilities for your child’s education, you may have to spend a very large amount. Therefore, to ensure that your child does not face a shortage of finances when they go to college or suffer financial drawbacks in your absence, select a coverage amount that can comfortably cover the education as well as any emergency requirements while also covering the future rate of inflation and its impact on the policy.
The following table highlights the documents may be required for buying children’s insurance plans and may vary as per the plan requirements.
Document type |
Acceptable documents |
Proof of Age |
Birth Certificate, Class 10/12 Marksheet, Passport |
Proof of Identity |
Aadhaar Card, Passport, PAN Card, Voter ID |
Proof of Income |
Document showing the income of the insurance buyer |
Proof of Address |
Telephone Bill, Electricity Bill, Ration Card, Passport, Driving License |
Proposal Form |
Duly filled proposal form |
Here is how the claim process for child insurance plan works.
Our experts are happy to help you!
Our experts are happy to help you!
Buy a child insurance plan as early as possible to save for your child’s future. Start when they’re in school and choose a policy term that can cover college or university expenses.
A child education plan builds savings for future educational needs and provides life cover for the parent, ensuring benefits, waiver of premium, and maturity proceeds if the parent passes away.
To get a fair estimate of a child’s education plan, calculate your child’s future educational expenses, including tuition, accommodation, and inflation. Also, consider possible emergencies. You can also use a child education plan calculator to select suitable coverage.
Yes, Premiums are eligible for tax3 deductions under Section 80C up to ₹1.5 Lakh, and maturity proceeds or death benefits may also qualify for tax benefits, depending on the policy terms.
To choose appropriate coverage, consider the expenses the plan should cover and select a sum assured that provides adequate support for your child. You can also compare different plans using a cost-benefit analysis to find a suitable option.
Policy tenure depends on your educational plans for your child and the insurance needs. You should choose a tenure that aligns the plan with your child’s educational and financial goals.
The best plan for child education in India depends on the goals, budget, and future study needs of the child.
The required documents to buy a child insurance plan are identity proof, address proof, income details of the life insured and other documents as per the policy requirement.
Child life coverage is a pre-determined sum paid to the nominee if the parent (policyholder) passes away during the policy term. It helps ensure financial support for the child’s future needs.
Yes, many plans allow customisation, letting you adjust the premium payment frequency and other plan features as per plan eligibility.
Yes, many child plans offer guaranteed2 amounts, providing a clear and defined sum that will be available for your child’s future needs. 2T&C apply
In case of ULIP plans, partial withdrawals are usually allowed after a fixed lock-in period, and you can use them to meet your child’s financial needs.
Yes, parents can buy plans for children up to a certain age limit, depending on insurer policy.
A nominee or beneficiary is important because the sum is paid to them if the parent dies during the policy term.
The eligibility criteria to buy a child insurance plan are, the child must be an Indian citizen, the parent or legal guardian must be an Indian citizen, and the age requirements vary depending on the plan and insurer.
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