The insurance business in India isn’t just growing, but also becoming more sophisticated in terms of product offerings. To help readers keep ahead of developments in this business, Mint features a Q&A on insurance every Monday.
I have been blessed with a child a month ago and have been approached by an agent to buy a child plan. What are the advantages of buying one?
Planning for your child’s future is an important decision in any parent’s life. While you may well have a financial plan in place for your own future, it is equally vital that you make similar provisions for your child’s future. There are a variety of products available to provide for the child.
Child insurance plans are tailor-made to act as a savings tool to secure your child’s future. Child plans help address your child’s future education and/or marriage needs. They also provide the capital that your child may need at a later stage to venture into a business. The earlier you start investing, the higher would be the fund value of your policy on maturity.
What is a group pension scheme? Do life insurance companies offer such a scheme?
A group pension scheme is a product that an employer sets up for the benefit of his employees. All staff can become members. Most of the life insurance companies offer group superannuation products. A well-structured group superannuation plan helps to create an irrevocable fund during the working lifetime of the employees for their pension benefits after retirement.
The employer can make a contribution of up to 15% of basic salary of the employee towards this fund. The employee can also make voluntary contributions to the superannuation fund.
Readers are welcome to write in with their queries to firstname.lastname@example.org. The questions will be answered by senior executives from leading insurance firms.
This week’s expert is T.R Ramachandran, managing director and CEO, Aviva India.