With each passing day, the cost of higher education is increasing. Amidst a bigger need for access to higher education and these costs always create a lot of financial strain on families.
As a result, a number of parents have embarked on a child education policy. Kate Mukamujema, a working class mother whose seven year old son in Primary One is covered by education insurance. She said she made this move when she realised that education was a treasure that came with its share of challenges.
“It is important to start planning for your child’s education as soon as possible, because the earlier you begin, the more time you allow your money to grow. This avoids any future unnecessary suffering on your child in case of uncertainties that may arise,” Mukamujema said.
The Child Education Policy is a life insurance schem specially designed as a savings tool to provide an amount of money when your child reaches the age for entry into college.
According to Titian Muberangabo, the Director of Life and Personal Accidents with a local insurance company, insuring a child’s education is one of the best selling life products because of its value.
“The child education policy will provide the funds needed by your child to pursue further education and assures that whatever happens in the future, your child will still have the means to pursue some of his or her goals in life,” Muberangabo said.
Parents need to start saving at least five years before children enter secondary school. This he said would spread out the amounts over a period of time without straining a parent’s budget.
He also pointed out that the act of parents insuring their children’s education is a sign of practical behaviour and reasoning.
“Without insurance you are irresponsible. People should always think of their children and other people in their lives. Let’s face it, certain circumstances are uncertain and we have no control over them like death,” he said.
The Child Education Policy apart from being a saving scheme, if well considered comes with a number of benefits.
The policy is an insurance scheme, whereby in case of death of the subscriber, the insurer will pay the remaining secondary school and University tuition of the child.
Better still, if the child is in primary school, 50 percent of their primary education is covered by the insurer.
In other words, the education policy provides assurance that, in the event of the subscriber’s untimely demise, the child will have access to the funds to help finance his or her studies.
In cases where the child can no longer benefit from the insurance cover, the amount is transferable to another child of the subscriber choice.
Also, in case a subscriber wakes up one morning and decides to withdraw the insurance cover, there is a money back guarantee depending on the conditions of withdrawal.
Amidst all these exchanges of payments between the subscriber and the insurer a number of conditions have to be considered that ensure that the system stays working.
“When choosing a policy, consider how much money you want to set aside for your child’s education. Make sure that the premium is affordable and choose a policy that gives you flexibility so you can gradually increase your savings in the future,” Muberangabo advised.
With this, one can only see the need of insuring doubtful periods, now that the woes of the global financial crisis like inflation are still around the corner.
What some say about insurance
Mugabo, self employed father of two.
“Although the idea of ensuring that my children continue with education in the event that I pass away before they complete, I am not sure I would like to leave my money with these companies. I think I am better off saving the same amount by myself instead of giving it to them to save. That way, I am sure it is always close by in case I need it for an emergency”
Majyambere, single mother of one
“I have always been a planner and so in addition to other policies, I have an education policy for my son. Of course I am not always ‘happy’ letting go of the monthly premiums, but I know that in the end, he will benefit because I will not struggle too much to raise college fees for him”
Asiimwe, 34 year-old bachelor
“I believe in insuring assets such as cars, houses and household equipment. The idea of taking life or education policies is still alien to me, probably when I get dependents, I may reconsider my stand”.
Uwimana, business woman, wife and mother
“As in all aspects of life, it is important to plan. For any major occasion or event in life, we plan, so why not for our children’s education or against misfortunes that might prevent us from providing for our families? I believe it is irresponsible not to plan, in whichever way one deems fit. The important thing is to plan”