Can NRIs Avail Term Insurance Plans in India?

Sophie

In India, everyone, irrespective of their residential status, can buy a term insurance plan. Read on to know more about how NRIs can buy a term plan.

NRIs (Non-Residential Indians) have two choices for purchasing life insurance to protect your family’s financial needs:

  1. They can buy life insurance plan in your current country of residence
  2. They can purchase a life insurance plan in India

If you are an NRI, here are a few reasons why you must choose the second option. Let’s assume,  you are an NRI living in country A. However, your job takes you all around the world, and it’s most likely that you won’t be residing in country A, a few years down the line. In this case, it makes sense to purchase a term plan in India.

How can NRIs purchase term life plans in India?

There are two options:

  1. You can purchase the plan when you visit India

Get in touch with your preferred insurance provider. Fill in the insurance proposal form, submit the required medical documents, take the necessary medical tests (if any), pay the premium, and get the term plan issued.

Remember that term plans you purchase in India are valid worldwide. In case of your unfortunate demise, while you are living overseas, your family can still claim the lump sum amount. It’s paid in Indian rupees directly to their account.

The insurance premium for NRIs is similar to that of resident Indians.

  1. You can purchase life insurance with Indian insurance companies while you are overseas

You can buy term insurance plans even from the country of your current residence. Get in touch with your preferred insurance provider to know the details. Your insurer may require you to undergo medical tests overseas in your country of residence and send the reports to India. One thing you must remember is that you have to pay for the medical tests by yourself. The insurance company won’t pay for medical tests taken overseas.

  1. How can NRIs pay the premiums for life insurance plans purchased in India?

You can pay the premiums from your country of residence using an NRE/NRO/FCNR bank account. If you are paying the premiums in foreign currency, then you will have to use the NRE/FCNR account. On the other hand, if you are paying the premiums in Indian rupees, then you will have to use the NRO bank account.

  1. Should NRIs purchase life insurance in India, if they plan to settle overseas permanently?

If you plan to settle overseas permanently with your family members and have no intention of returning to India in the future, then purchasing life insurance in your country of residence, would be the smarter choice. This is because premiums are cheaper overseas, and you are likely to get a higher sum assured.