Insurance companies design child plans such that they look apt and attractive for managing the child’s higher education. You plan for a corpus and start paying for that at the child’s early age. The amount is guaranteed on maturity and is tax free.  What more, the payer benefit is generally inbuilt in the plan. So, in case the parent dies before policy maturity, all remaining premium payments are waived off and the child still gets the maturity amount on the due date. This allows your dreams to be fulfilled even if you are not around. Only issue is that you need to decide early in the child’s life so that you get the required corpus at the right time without paying hefty premiums.

Traditional child education plans tend to bring a sense of security. There is no market risk involved. You know your savings are safe and growing, even though at a slower pace than other market based investments. But then, you don’t even want to take any risk when it comes to children. To keep up with the returns and growth insurance companies also announce bonus and loyalty additions from time to time. This amount is also added to the maturity amount.

The biggest benefit is the psychological satisfaction though. You are saving for the child’s education, it is mandatory to pay premium to keep the policy from lapsing. Since it is for the child, even if you have to surrender few policies, in an emergency situation child education plan will be the last to be touched.

Let your child dream big, with education plan in your portfolio, you are prepared to handle the costs of education.