Children's insurance helps generate funds

Life insurance plays an important role in an individual's financial planning exercise. Insurance can assist individuals in planning for their own life stages as well as provide for their children's future.

It also secures a child's future in case of any unfortunate event. Various kinds of child insurance products are available in the market.

Parents need to build a sufficient corpus for their children . They should start planning for their children at an early age.

One of the biggest financial commitments for parents is to meet the expenses incurred in bringing up and settling their children. Child insurance plans play an important role in securing a child's future. With a number of children's insurance plans available in the market, it becomes difficult for most parents to evaluate them objectively.

The factors to be kept in mind include the timeframe for building a corpus, age at which the funds would be required, approximate amount needed to build the corpus, investment avenues to be considered and the amount available to the child in case of death of parents.

As inflation rises, the first impact is on the education sector. Planning for a child's future is an important step. It is advisable that parents go for a term policy.

That will take care of the child's financial needs in case of untimely death of any of the working parents. For the child's future, one can create a specific financial plan through systematic investment planning (SIP) in mutual funds.