Child Care Plan

A comprehensive child care plan should be a combination of both investments and insurance. The former allows parents to save and grow funds for their kids’ future. If you add an insurance component to it, you can ensure that the child is protected even in times of adversity. While there are no insurance schemes by the name of Child Care Plan, there are several fund options that serve similar needs. If you couple these funds with a term insurance plan or a child ULIP, you can ensure well-rounded financial protection for your kid.

Investing in your child's future:A wise decision & a loving choice

Benefits of Investing In Child Plan

Waiver of Premium Benefit

Future Premiums are paid by the insurer upon death of policyholder

Flexible Payout Options

Your premiums help your child achieve their dreams through lump sum or regular payouts

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Zero Commission

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Tax Benefits^

You get tax benefits under Section 80(C) and no tax on returns under Section 10 (10D)

Investment Flexibility

It offers the flexibility to invest at regular intervals or as a one-time contribution

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7.7 Crore

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Insurance Partners

4.2 Crore

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Nothing Is More Important Than Securing Your Child's Future

Invest ₹10k/month your child will get ₹1 Cr^# Tax-Free* on Maturity

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We are rated^~

7.7 Crore

Registered Consumer

Insurance Partners

4.2 Crore

Policies Sold

Disclaimer: #The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CAGR 8%; ₹50,45,591 @ CAGR 4%. *Tax benefits and savings are subject to changes in tax laws. All plans listed here are of insurance companies’ funds.

Types Of Child Care Plans
Child Care Funds
Child Care Funds To Explore
ULIP Based Child Care Plans
Best Child ULIPs

Types Of Child Care Plans

Let’s look at the different options to give you an idea of the best possible ways to secure your child’s future.

Child Care Funds

These investment instruments park your money in the equity market. You earn generous returns on your investments if the market performs well. Some important pointers to note about these child care plans are:

The risk of investment in these funds is high and borne entirely by the investor.
You should invest for a longer term, possibly more than 5 years to earn the best returns.
The returns can be used towards a child’s education or their marriage.
Most of these funds come with a lock-in period, during which the investor or the child cannot withdraw any money. This period allows capital appreciation and your money to grow.
You can choose to invest a lump sum amount or a monthly sum through a SIP (systematic investment plan).
SIPs are easier on the pocket and balance out the risk to an extent.

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Invest ₹10K/Month YOU GET ₹1 Crores^* For Your Child View Plans

Invest ₹8K/Month YOU GET ₹80 Lakhs^* For Your Child View Plans

Invest ₹5K/Month YOU GET ₹50 Lakhs^* For Your Child View Plans

Standard T&C Apply *

Child Care Funds^†† To Explore

The following table lists examples of child care funds that allow parents to grow their savings for their children’s future.

Name of Fund	Description
HDFC Children's Gift Fund	The lock-in period is 5 years or till the child attains 18 years of age, whichever comes early. 65-80% of the money is invested in equity and the remaining in debt funds.
ICICI Prudential Child Care Fund (Gift Plan)	The objective of this child care plan is to offer long-term monetary benefits to the child through equity investment. The minimum purchase price is Rs. 5000 and a minimum additional investment of Rs. 1000 is required.
SBI Magnum Children’s Benefit Fund Growth	This child care fund invests in debt and equity markets. A minimum investment of Rs. 5000 is required. It is a moderately high-risk investment fund.

Disclaimer: †† Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is done in alphabetical order (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in

ULIP Based Child Care Plans

Child plans such as ULIPs (unit-linked insurance plans) have the additional advantage of insurance protection. The combined benefit of market-linked returns and insurance make these plans ideal for children. Key benefits of such child care plans are:

Future premiums are waived off on the death of the parent.
A part of the premium is invested in market linked funds such as equity and debt.
On the parent’s demise, the child receives the death benefit amount.
The investment risk is borne by the parent.
Some insurers may provide loyalty benefits to existing customers.
Investors have flexibility in choosing funds and investment strategies.
Investors can enjoy tax benefits under the existing tax laws in the country.

Unique Triple Benefit

Future premiums paid by insurer on parent's death

Monthly income to fund child's education on parent's death

Lumpsum payout to family on parent's death

Returns

Return as of Apr 2024
12%-15%
8.2%
7.1%

Availability

Availability
Girl Child or Boy Child
Girl child only
Girl Child or Boy Child

Max Entry Age
Upto 18 years
Upto 10 years
No Age Limit

Flexibility

Invested Amount can be Withdrawn after
5 years
21 years
15 years

Conditions for Premature closure
Anytime after 5years
Extreme Compassionate Grounds
Serious Ailments or for education

Penalty on Premature Closure
No Penalty after 5 years
Returns reduced to Post Office Savings rate
1% reduction in interest rate

Max deposit amount in an year
No Limit
1.5 Lacs
1.5 Lacs

Documentation

Documentation Required for Withdrawal
Low
High
Low

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Best Child ULIPs

Name of Fund	Description
HDFC SL YoungStar Super Premium	It comes with 4 fund options and you can switch between them anytime. Future premiums are waived off and the child is paid the death benefit amount on the demise of a parent.
Max Life Shiksha Plus Super	It funds future premiums due if the parent dies. It offers an income benefit to finance your child’s key milestones.
SBI Life Smart Scholar	It offers liquidity benefits from the 6th year. This child care plan comes with 9 fund options Premium waiver benefit is applicable on the death of a parent along with the death benefit.

†Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is based on past 10 years’ fund performance (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
*All savings are provided by the insurer as per the IRDAI approved insurance plan.
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
#The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CARG 8%; ₹50,45,591 @ CAGR 4%
+Returns Since Inception of LIC Growth Fund
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
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^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.