The expense of children’s higher education is continuously increasing. In such a situation, if you want to make a safe investment from now on for their education and future, then child plans of Life Insurance Corporation of India (LIC) can be a good option. These plans not only provide life cover, but also provide benefits of savings, bonus and tax exemption under Section 80C under the old tax system. However, before choosing any scheme, it is important to understand its potential returns. For this, Internal Rate of Return (IRR) is considered an important parameter.
LIC’s three major child schemes in 2026—Jeevan Lakshya (933), New Children’s Money Back (932) and Jeevan Tarun (934)—are in the news. Let us know what is the difference between them and investing in which scheme can be more beneficial.
What is IRR and why is it important?
IRR i.e. Internal Rate of Return is the estimated annual return, which is calculated on the basis of the premium deposited by the investor and the total benefits received from the policy. This includes survival benefit, maturity amount and bonus. The higher the IRR in any investment scheme, the better its potential returns in the long run.
Comparison of all three plans
If a sum assured of Rs 10 lakh is taken for a newborn child, then the annual premium in all three plans comes to around Rs 42 thousand. Among these, the IRR of Jeevan Lakshya is about 7.02 percent, which is the highest among the three. In this scheme, the full sum assured and bonus is available on completion of the tenure of 25 years. Apart from this, survival benefit is also available during the stipulated period.
Whereas the IRR of New Children’s Money Back Scheme is around 6.87 percent. In this, 20-20 percent of the sum assured is given at the age of 18, 20 and 22 years of the child and a bonus is given along with the remaining amount on maturity.
On the other hand, the IRR of Jeevan Tarun scheme is around 6.86 percent. Its biggest feature is that it gives the facility to choose survival benefit of 20 to 40 percent as per the need between the age of 20 to 24 years. Full sum assured and bonus is also available at the age of 25 years.
These benefits are available in all schemes
Investments in these three schemes can be made from the birth of the child till 12 years of age. Facilities like life cover, bonus, loan and surrender value are available in all the plans. Additionally, if the parent paying the premium dies, further premium can be waived off under the Premium Waiver Rider and the child continues to receive all the benefits as scheduled.
Keep these things in mind before investing
Experts say that any child plan should not be selected just by looking at the returns. The decision should be taken keeping in mind the current age of the child, educational goals, family budget and your financial needs. Also, read the terms and conditions of the policy thoroughly and if needed, take advice from LIC agent or certified financial advisor. By choosing the right plan today, the financial burden of your child’s higher education in the future can be reduced to a great extent.
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