NRIs Can Buy Term Insurance Abroad, But Here’s What They Need To Know

This article takes a look at the things that an NRI should consider while buying term insurance abroad.

Rakesh Goel, Director, Probus Insurance, said, “If one is buying in other countries, the formalities will be a bit lengthy. The country where the policyholder resides matters, as buying a policy depends on the eligibility and premium of the policy. That particular factor. If there are countries where there is political instability, the premium will be higher. Many insurers have a list of countries in which their services are not available. So one needs to see the insurance companies before buying the policy carefully The term of the policy can be between six months to 25 years.

In addition, some insurers also offer a whole life policy for NRIs. Some may conduct telemedical exams, while one has to submit relevant documents as demanded by insurance companies.

Varun Gupta, Head and Appointed Actuary, Bharti AXA Life Insurance said, “An individual may need to undergo all necessary medical examinations and share the report with the insurer while choosing a policy. For tests conducted outside India, generally But, the cost is to be borne by the person.”

Further, if the policy is issued in Indian currency, an NRI can pay the premium through Non-Resident Ordinary (NRO) account. If the policy is purchased in a foreign currency, the policy premium can be paid through their NRE, FCNR account, SWIFT transfer or through an international credit card.

Gupta said, “However, naturally the families of people residing outside India have come back to the country who can ensure that the premiums after purchase of the policy are paid through the bank account of the Life Assured in India.” is done.” Therefore, it is important to check in which currency the policy is issued as the insurer can issue the policy in the currency of an NRI or a country resident in Indian currency.

Do premiums differ? Generally, the premiums are not different for residents and NRIs. Gupta said, “Premiums are based after an assessment of the risk involved in an individual – health, financial or country-specific underwriting, the last being particularly relevant to NRIs. Therefore, if the NRI resides in such country Where the risk to life is high, the premium will automatically be at a higher level.”

Claim Benefits: Once a term policy is issued, any insurance company in India will cover death regardless of the country of residence of the NRI. To submit a death claim, the nominee of the policy has to submit all the required documents as listed by the insurer. “The tax and tax benefits on the policy are based on the tax laws prevailing in the country in which the individual resides,” Gupta said.