As well as having health insurance to support the health costs that will arise in the future, if thinking about education, the thing that can not be separated from the consideration is the cost. It is a fact known to almost every parent that the cost of education is increasingly increasing. It is estimated that the cost of education increases about 10-15% per year. Well, how do you anticipate the increase in education costs?
One thing you might think about is a special savings for education funding, either by opening a regular savings account or opening an education savings account. Another one is to invest, which if successful then the results you can later use to finance your child's education. Another alternative that you can consider is education insurance. For the latter, perhaps not many understand the details, including you. Please keep in mind to find out more about education insurance for your child.
What is Education Insurance?
Basically, education insurance is one of the insurance products which is a combination of term life insurance products (term life insurance) with savings or investment. With this type of insurance, the insurance company as the insurer will replace the sum assured if the parent as the insured dies while his son still have to pursue education level.
So in other words, the function of education insurance is for protection or protection as well as education funding. The parent who becomes the primary breadwinner as the policyholder is required to pay the premium in a certain amount and time according to the option, with the benefit of disbursing the funds every time the child enters a new level of education, whether it is elementary, junior high, high school, and college, and insurance funds will still be provided if the parent dies without having to pay a premium again.
What's the Difference with Education Savings?
Many still do not know what is the difference between education insurance and education savings. At first glance both look alike, both preparing for education funding, providing insurance and investment protection. But actual education insurance is different from education savings. The main difference lies in the risks and returns of totally different investments. Let's see what is the difference between education insurance and education savings:
| Asuransi Pendidikan | Tabungan Pendidikan | |
| Warranty | Educational insurance is not a product issued by a bank, and thus there is no guarantee from the bank. This insurance is a product of the insurance company and even if you buy it at the bank, the bank only acts as the agent of the insurance product. | Education savings (or anyone calling it a savings plan or other term) are products issued by the bank, and therefore guaranteed by the Deposit Insurance Corporation (LPS), at least up to a certain amount with the maximum interest rate. If anything happens to the bank concerned, your savings will be safe because there is a guarantee from LPS. |
| Investment Profit | The magnitude of the benefits of education insurance can not be ascertained because it depends on several things, including investment performance and investment risk based on the type of investment you choose. For example, if choosing a stock fund as an investment instrument, then the amount of investment profits will depend on fluctuations in stock prices, so if you choose money market mutual funds will depend on money market movements. Thus, the investment benefits of education insurance are uncertain, may increase may also decrease. | As for educational savings, the rate of return earned from the savings interest is certain, in the sense that you will get interest payments in accordance with that set by the bank. So, the value of your savings in education savings will not decrease. |
| Risk | In education insurance, although there is an opportunity to earn high returns or investment profits, it can even double over the education savings, but behind it there is a high risk too. | Meanwhile, for educational savings, it can be said there is no risk because the profits are definitely obtained from interest savings. |
| Protection | The value of protection or protection from educational insurance is practically unlimited, depending on your ability to pay a premium. | Savings education value of insurance coverage is generally lower than the insurance education. Premiums for insurance protection are paid by banks so that the sum insured is limited, usually only up to a maximum of a certain deposit amount. |
Tips for Choosing the Best Education Insurance for Children
To choose which educational insurance is best for your child, there are some tips you can follow or be taken into consideration, the main thing is to learn the value of protection and investment. These two things are a must to consider in choosing educational insurance. It is important to know how much protection or protection in the form of Sum Insured if the parent as the insured dies, accidents, or permanent disability, so as to ensure the child remains able to attend school smoothly. In addition to the investment that accompanies educational insurance, although riskier than savings, it promises a higher profit potential, thus more suited to the high cost of education. Learn more about the types of investments that accompany an educational insurance product.
In addition to the above two things, some other important things to consider in choosing the best education insurance for your child are:
- Find a trusted insurance company and have a good track record
- Search for a quick and easy claim disbursement
- Think information to people who have already used the insurance product from the same company
- Ask for information about the shortcomings and advantages of insurance products offered to insurance agents
- Make sure the premiums paid in accordance with your financial ability, and whether it can be changed in accordance with the financial condition.
- Ensure the program is offered in accordance with the promised benefits, meaning that the value of the insurance savings should be in accordance with your child's school cost plan
Best Education Insurance Options
Below are some of the best education insurance providers collected from various sources:
1. PT Prudential Life Assurance (Prudential Indonesia)
The insurance company that was founded in 1995 also offers educational insurance products, including:
- PRUmy child, which provides comprehensive protection from the moment in the womb, is born, to adulthood, ranging from health, financial, and education protection.
- PRUlink edu protection, which is an investment-related product that provides monthly funding during risk.
2. Manulife
Educational insurance products offered by this insurance company are:
- ProGraduate, an insurance program to help prepare children's education funding from college up to 23 years old, with the benefit of cash payment as a total education fund of 250% of Sum Insured and flexible premium payment period as per children's education needs and financial condition.
- StudyLink, insurance plus investments to prepare children's education funding through withdrawal of scheduled invested funds from children aged 6 to 23 years.
3. AXA Mandiri
The company whose shares are owned by AXA Group and Bank Mandiri offers a wide selection of products, including:
- Mandiri Savings Insurance Plan, a product designed to prepare and realize future dreams such as sending children, weddings, to pension preparation.
- Mandiri Sejahtera Cerdas Syariah Insurance, life insurance products intended to help financial planning if disaster comes, and also provide educational insurance benefits unit link with a competitive level of investment.
4. AJB Bumiputera 1912
Educational insurance products offered are Scholarship Partners and Smart Partners.
- Scholarship Partners, providing child protection and tuition fees ranging from kindergarten to college, regardless of changing financial circumstances.
- Smart partners, an insurance program that provides investment-related tuition fees so that funds designed for tuition fees will increase in line with investment returns.
Choose the Best Education Insurance, Child Education Cost Awake
So there are many factors you can consider choosing educational insurance for your child. What is clear is the decision is in your hands, choose the most appropriate to your financial ability and goals so as to ensure the cost of your child's education is maintained. Congratulations to prepare your child's education fund by choosing the best education insurance for you and your child's future!