LIC Child Plans Compared: Amritbaal, Jeevan Tarun or New Children’s Money Back - Which One Is Right for Your Child?

Every parent dreams of providing a secure and bright future for their child. From higher education and career plans to other important life milestones, financial planning plays a crucial role.

The Life Insurance Corporation of India (LIC) offers several insurance Plans designed specifically to support children`s future financial needs. Among them are LIC Amritbaal (Plan 874), LIC Jeevan Tarun (Plan 834) and LIC New Children’s Money Back Plan (Plan 932).

Each plan has a different benefit structure. Some are designed to provide a lump sum at maturity, while others offer periodic payouts to help meet education and other expenses.

Here is a simple comparison of the three LIC child plans.

LIC Amritbaal – Plan 874

LIC Amritbaal is designed to help parents build a financial corpus for their children`s future needs.

Key Features

- Available for children from 0 to 13 years of age.

- It is a non-market-linked insurance plan.

- The policy term generally ranges from 10 to 25 years, subject to the policy conditions.

- The maturity benefit is designed to support the child`s future financial requirements, including higher education and other major expenses.

- Premium payment options include:

- Single premium

- Limited premium payment options, such as 5 or 7 years, depending on the policy terms.

- The plan may also provide guaranteed additions or other benefits as specified under the policy.

This plan may suit parents looking for a structured savings and insurance option without direct exposure to stock market fluctuations.

LIC Jeevan Tarun – Plan 834

LIC Jeevan Tarun is designed to provide financial support during the important years of a child`s education and early adulthood.

Key Features

- Available for children aged between 90 days and 12 years.

- Benefits are structured around the period when the child is between 18 and 25 years old.

- Premium payments are generally required only until the child reaches the specified premium-paying age, while the policy continues until maturity.

- The plan offers different benefit options.

Under one option, the policyholder may receive 5% of the Sum Assured annually from ages 18 to 24, followed by 65% of the Sum Assured, along with applicable bonuses, at age 25.

This type of structure may be useful for parents who expect recurriring expenses, such as college fees and other educational costs, during these years.

LIC New Children’s Money Back Plan – Plan 932

As the name suggests, this plan follows a money-back structure, providing payments at different stages of the child`s life.

Key Features

- Available for children from 0 to 12 years of age.

- 20% of the Sum Assured is paid at ages 18, 20 and 22.

- The remaining 40% of the Sum Assured, along with applicable bonuses, is paid at maturity at age 25, subject to the policy terms.

This structure may be suitable for parents who want to receive funds at multiple stages rather than waiting for a single lump-sum maturity payment.

The Premium Waiver Benefit: An Important Protection for Children

While choosing a child insurance plan, parents should carefully consider the Premium Waiver Benefit (PWB) Rider, wherever available and suitable.

This benefit can provide crucial financial protection if the parent paying the premiums passes away during the policy term.

In such a situation, future premiums may be waived according to the rider`s terms and conditions, allowing the policy to continue without the family having to bear the burden of future premium payments. The child can then receive the applicable policy benefits at maturity.

For this reason, parents should carefully understand the terms, eligibility conditions and exclusions of the Premium Waiver Benefit Rider before purchasing the policy.

Which LIC Child Plan Should You Choose?

The right plan depends on your financial goals and when you expect your child to need the money.

Final Word

Choosing a child insurance plan should not be based only on the maturity amount or bonus illustrations. Parents should also consider the premium amount, policy term, payout structure, insurance coverage, liquidity needs and overall financial goals.

Most importantly, if the family`s financial plan depends on the parent`s income, understanding the Premium Waiver Benefit Rider can be crucial.l. It may help ensure that the child`s financial plan continues even if an unexpected event affects the parent responsible for paying the premiums.

Before purchasing any LIC policy, carefully read the latest policy brochure, benefit illustration and terms and conditions, as plan features, bonuses and eligibility criteria may vary.