New Delhi: Every parent dreams of giving their children a secure and bright future. Accumulating sufficient funds for life’s crucial milestones like their good education, starting a career, and marriage is a big responsibility. To make this responsibility easier, Life Insurance Corporation of India (LIC) has introduced an excellent scheme for children – LIC’s Amrit Baal Scheme. This is not a market-linked policy; instead, it’s a non-linked, non-participating, individual savings, and life insurance plan that provides security for your child’s life while also helping build a strong guaranteed fund for their future.

For Whom and When Can You Take the Amrit Baal Scheme?

This policy is specifically taken in the child’s name. You can start investing in this scheme for a child from as young as 30 days old up to 13 years of age. The child’s age at policy maturity (when the child receives the money) must be a minimum of 18 years and you can set the maturity age up to a maximum of 25 years.

How Much Investment is Required?

In LIC’s Amrit Baal scheme, you can take a minimum Sum Assured of ₹2 lakh. The good thing is that there is no upper limit on the maximum sum assured. You can choose a sum assured much larger than ₹2 lakh, according to your planning and capacity.

How is This Scheme Beneficial? Guaranteed Return is the Biggest USP!

The most attractive feature of this policy is the Guaranteed Return (Guaranteed Additions) it provides. This does not depend on market fluctuations. From the first day of taking the policy until maturity, LIC guarantees to add ₹80 per ₹1,000 of your Basic Sum Assured at the end of every policy year.

For example, if you have taken a Sum Assured of ₹5 lakh, LIC will guaranteed add ₹5 lakh / 1000 * 80 = ₹40,000 to your fund every year. This amount will be added to your basic sum assured every year, significantly increasing the total amount received at maturity.

How Will the Money Be Received at Maturity?

When the child reaches the maturity age you have set (between 18 and 25 years), they will receive the Basic Sum Assured along with all the Guaranteed Additions accumulated up to that date. This amount will be useful for major expenses like the child’s higher education or marriage. The best facility is that you can choose to take this total amount received at maturity either as a Lump Sum all at once, or you can opt to receive it in installments over 5 years, 10 years, or 15 years according to your needs. This provides excellent flexibility in planning for the child’s future.

Will the Child Also Get Life Insurance Cover?

Yes, this is also a life insurance policy and covers the child’s life. If unfortunately, the insured child passes away during the policy term (before maturity), the nominee (usually the parent) is paid the Death Benefit. This Death Benefit includes the Sum Assured on Death along with the accumulated Guaranteed Additions up to that time. (The calculation of Sum Assured on Death depends on the policy and premium payment option).

Other Benefits and Investment Methods:

  • Loan Facility: If needed, you can also take a loan against the policy’s Surrender Value under certain conditions.
  • Investment Method: You can invest in this scheme through both online and offline methods.
  • Premium Payment: You can pay the premium according to your convenience monthly, quarterly, half-yearly, or annually. There are also options for Single Premium (full payment at once) and Limited Premium (payment for a limited number of years).
  • Waiver of Premium Rider: With the Limited Premium option, you can also choose the Waiver of Premium Benefit Rider. The advantage of this is that if the policyholder (usually the parent) passes away, the remaining premiums for the child are waived, and the policy continues without interruption, with full benefits payable at maturity.

LIC’s Amrit Baal scheme is a reliable way to provide financial security and guaranteed growth for children’s future. Before making an investment decision, it is always best to carefully read the policy document available on LIC’s website and understand all the terms and conditions.