SBI Life Child Insurance Plans

SBI Life is a leading life insurance company which is formed as a joint venture between State Bank of India and BNP Paribas Cardiff. While the State Bank of India is one of the largest public sector banks in India, BNP Paribas Cardiff is the insurance arm of the BNP Paribas Group which deals in life insurance and property and casualty insurance. SBI Life started its operations in the Financial Year 2001-02 and ever since then it has grown by leaps and bounds. The company offers a range of life insurance products which help in fulfilling every financial goal that you might have.

Facts about SBI Life Insurance

Here are some facts about SBI Life Insurance Company which establishes the company’s reputation in the life insurance market –

1. In the financial year 2019-20, the company has recorded a very good growth ratio as it crossed the INR 300 million mark in terms of Gross Written Premium
2. As on 31st March 2018, the company’s Assets under Management stood at INR 101,226 crores
3. The company has more than 800 branches in India making it easily accessible for its customers
4. In the year 2019, the company received the SMART Award in the Life Insurance Large Category at the ET Insurance Summit Awards

Life insurance plans offered by SBI Life Insurance

SBI Life offers different types of life insurance plans which include the following –

1. Protection plans
2. Wealth creation and insurance plans
3. Retirement plans
4. Money-back plans
5. Child plans
6. Savings plans
7. Combo plans
8. Online plans

Among these plans, child insurance plans offered by the company help in protecting the financial future of your child. Let’s discuss the different types of SBI child plans which are offered by the company –

What is a child plan?

A child insurance plan is a life insurance plan which can be taken on the life of a child or the parent. The objective of a child insurance plan is to create a secured financial corpus for a child so that the future financial needs of the child can be easily met. Under child insurance plans, the parent is the policyholder. There is an inbuilt benefit under these plans wherein, if the policyholder dies during the policy tenure, the policy does not get affected. Future premiums are waived off and the insurance company pays the premiums in place of the parent. Thereafter, on the maturity of the policy, the promised maturity benefit is paid. This benefit, therefore, helps the child to meet his higher education costs or any other type of financial requirement which the child might have.

 Why child plans are required?

A child insurance plan proves to be a very good choice if you want to plan a secured financial future of your child. Here are some reasons why –

1. The plan ensures that the financial security of the child is not hampered even in case of premature death of the parent. Since the plan has an inbuilt premium waiver benefit, the plan continues even if the parent dies
2. When you buy a child insurance plan, you earmark a specific investment meant for your child. The plan continues for the chosen tenure and gives you the financial corpus required for your child’s higher education or for marriage
3. The premiums that you pay towards a child insurance plan are allowed as a deduction from your taxable income. You can claim a deduction of up to INR 1.5 lakhs on the premiums paid under Section 80C. This helps you in saving your tax outgo while at the same time investing for your child
4. The benefits received from the policy are also tax-free benefits. You or your family would not have to pay any taxes on the policy benefits received as they are exempted from taxation under Section 10 (10D) of the Income Tax Act, 1961.

SBI Child Plans

SBI Life Insurance Company offers two types of child life insurance plans. Let’s understand what these plans are, their features and benefits and their eligibility conditions.

1. SBI Life Smart Champ Insurance Plan

SBI Life Smart Champ Insurance plan is a traditional money back policy which gives you smart money back benefits during the term of the policy. The features of the plan are as follows –

1. The term of the plan is allowed in such a manner that the plan matures when the child attains 21 years of age
2. This SBI child plan is a participating plan which earns bonuses throughout the term of the policy
3. Money-back benefits under the policy are paid in the last four years of the plan. The benefit is paid @ 25% of the sum assured and the vested bonus
4. Money-back benefits are, therefore, paid at ages when the child completes 18, 19, 20 and 21 years. These benefits, therefore, help the parent to pay for the education costs of the child
5. On maturity, i.e. when the child attains 21 years of age, the last instalment of the sum assured is paid along with the terminal bonus, if any
6. Accidental Total and Permanent Disability benefit is inbuilt under the plan
7. The parent is insured under the policy. If the parent dies or becomes permanently disabled during the policy tenure, the sum assured is paid immediately. Future premiums are waived and the money-back benefits accrue as and when they are promised
8. You can pay the premiums for a limited time or at once when buying the policy
9. Premium rebates are available if you choose a high level of sum assured and also if you buy the policy online directly from the company itself

Eligibility conditions of SBI Life Smart Champ Insurance Plan

Entry age of the parent	21 years to 50 years
Entry age of the beneficiary child	0 years to 13 years
Sum assured	Minimum – INR 1 lakh Maximum – INR 1 crore
Policy tenure	21 – child’s entry age
Premium paying term	Single premium – once Limited premium – 18 – child’s entry age
Premium amount	Limited premium payment: Minimum – 6000/year Maximum – depends on the sum assured, age and term Single premium payment: Minimum – INR 66,000 Maximum – depends on the sum assured, age and term

2. SBI Life Smart Scholar Plan

SBI Life Smart Scholar Plan is a unit-linked SBI child plan. Under this SBI child plan, the premiums that you pay are invested in the market through various funds which you can select. Since the premium is invested in the market, it attracts good returns and you can maximize the savings which you set aside for your child’s future. The features and benefits of this SBI child plan are as follows –

1. The plan has two inbuilt riders in its coverage scope. One is the premium waiver rider which waives the premium when the parent dies. The other is the rider for accidental death and total permanent disability. An additional benefit is paid if the insured dies or becomes disabled in an accident
2. Loyalty additions are also added to the fund value, besides the market-linked growth. This helps the fund value to grow considerably
3.  There are seven types of investment funds and you can choose a combination of these funds depending on your risk appetite
4. The parent’s life is insured under the plan. In case of death or disability suffered by the parent, a death benefit is immediately paid but the plan continues. The premiums are paid by the company. on maturity, the available fund value is again paid to the child for his/her financial requirements
5. You can switch between funds, redirect your future premiums and even withdraw from the fund value partially during the policy tenure
6. Both single premium and limited premium payment options are available under the policy
7. The maturity benefit can be taken in instalments over a period of five years. This feature is allowed under the Settlement Option feature available under the policy

Eligibility conditions of SBI Life Smart Scholar Plan

Entry age of the insured parent	18 years to 57 years
Entry age of the beneficiary child	0 years to 17 years
Term of the policy	8 years to 25 years
Premium payment term	Single premium – once Limited premium – 5 years to 25 years
Premium amount	Single premium: Minimum – INR 75,000 Maximum – no limit Limited premium where premium paying term is 8 years and above: Minimum – INR 24,000/year Maximum – no limit Limited premium where premium paying term is 5 or 7 years: Minimum – INR 50,000/year Maximum – no limit
Sum assured	1.25 times to 20 times the premium amount depending on age

Who should buy SBI child plans?

SBI child plans should be bought by parents who have a minor child and who would like to create a secured corpus for their child’s future. If you have a low-risk appetite you can choose SBI Life Smart Champ Insurance which is a traditional plan giving you guaranteed benefits. If, on the other hand, you don’t mind taking risks and want wealth maximization for a maximum corpus, SBI Life Smart Scholar Plan is ideal as the plan would allow you market-linked returns as well as insurance cover. Both the plans have inbuilt rider benefits which make the scope of coverage extensive. So, choose the ideal policy and secure yourself for your child.

SBI child plan application process – how to buy?

There are two options to apply for SBI child plans. They are as follows –

1. Offline application

   Offline application means applying for the policy physically by filling up and submitting a proposal form. You can apply offline through an agent of SBI Life Insurance Company. Alternatively, you can approach any nearest branch of the insurance company and apply for the chosen SBI child plan. Whether through an agent or through the company’s branch office, you would have to fill up the application form manually and submit it with the relevant documents. The company would receive the proposal for insurance, underwrite it and if everything is found sufficient, the policy would be issued.

2. Online application

   You can also buy the plan online which is a better alternative to an offline application. The company offers different types of online policies. You can choose the most suitable plan and then apply for it online. To apply, you would have to fill up an online application form and submit it with the relevant documents. The company would, then, underwrite the policy and if everything is in order, the policy would be issued.

You can also buy SBI child plan through Turtlemint as Turtlemint has tied-up with SBI Life Insurance Company to sell its insurance plans. Just visithttps://www.turtlemint.com/life-insurance and choose ‘Savings for Child’. Fill in the necessary details about yourself so that the correct premium can be calculated. Enter in your date of birth, gender, smoking preference, annual income, the coverage that you would like, child’s age, investment horizon and the investment amount. Based on the details provided, you would be shown different child insurance plans. You can, therefore, compare and select the best plan for your needs.

Documents required for buying SBI child plan

To buy any SBI child plan, you would have to submit the following documents –

1. Proposal form, filled and signed
2. Identity proof of the insured and child
3. Address proof of the policyholder
4. Income proof of the policyholder if high coverage levels are selected
5. Age proof of the insured and the child
6. Photographs of the child and the insured