The entry age of people going for insurance cover is showing a marked shift to the late 20s from 30s.

Children are pretty much the centre of our lives and this is all more relevant in the Indian context. Parents invest and save for not just their children’s education, but also for their marriage and future. 

Social orientation makes the Indian parent not just plan for their own retirement but also ensure financial legacy even when the child is well settled in life. 

Independent researches indicate that life insurance has emerged as an important financial instrument for protection and contractual savings today. Increasingly, young people are showing affinity to invest in life insurance at an early stage. 

Our experience corroborates these findings as we see the entry age showing a marked shift to the late 20s from 30s just five year back. We believe the trend is reflective of the fact that young people are starting their careers early today and want to achieve major material milestones of life, such as owning a house, buying the first car or even planning for their children’s future, earlier than their parents. 

A baby brings along a whole new set of domestic and financial responsibilities for parents. Research indicates that over 119 million parents in India in the 25-44 years age group are looking for financial planning to secure the future of their children. 

The research, titled Life 2008, clearly indicates that the relevance of life insurance as the financial instrument to plan for your child’s future has improved. In fact, 85 per cent of the respondents were aware of child plans offered by life insurers, yet only 15 per cent have bought these with the needs of their children in mind. 

The question that arises from here is why life insurance has an important role to play in planning for the needs of various life stages of children. 

Effective financial planning is eventually about appropriate assessment of the future needs of your child. Given your child’s age and current inflation levels, it is critical to estimate the corpus that would be required for your child’s future needs, such as higher education or even marriage. 

This would help you identify various investment and life insurance plans that can help you address all these needs when your child grows up. 

Planning for protection against unforeseen circumstances in life should be an important consideration of your financial planning. This is because, no matter how undesired it may sound, it is always good to plan for the uncertainties of life. 

Tomorrow, no situation in life should create a hurdle and result in our children’s future being compromised with. 

Child plans offered by life insurers usually waive off future premiums in case of the demise of the policy holder. The insurance company takes care of the future premiums and the full amount is given to the child upon maturity.

Last but not the least, parents and children alike aspire for more today. No parent is satisfied to see his or her child excel in academics alone. 

There is strong focus on extra-curricular activities and all-round development of the child. Today, there are specific 360-degree life insurance plans with additional features that provide resources for all-round development of your child under all uncertain circumstances. 

These life insurance plans provide the flexibility to opt for additional payments during the policy tenure to support talent which may not be evident initially when the policy is bought. 

Life insurance has emerged as a key component of financial planning. The relevance of life insurance as a long-term savings tool also comes from its primary feature of being need-based financial instrument that helps you meet your every life stage need, including the specific responsibilities of a parent. 

Prepare yourself better as a parent by saving and investing in child insurance early. Start early to reap the benefits. Give your child a great future.

Source :- Money Guru India