Term Insurance for NRI

Ans: Term insurance for NRI is a simple, affordable way to protect your family in India from financial uncertainty. Whether you are working abroad for a few years or have settled there for good, buying a term plan in India means your family receives financial support in your absence. Depending on the plan and underwriting, you can choose cover up to Rs. 20 crore or more, with policy terms from 10 years to whole life cover of up to 99 or 100 years.

Ans: Buy before you move if you can. You are still a resident, so there is no overseas paperwork and you can do your medical at a lab in India. The policy carries on when you move; you only have to tell the insurer your new country. Premiums depend on your age when you buy, so waiting makes the same cover cost more.

Ans: Often, yes. Some insurers ask NRI applicants to be graduates, while others decide on age, income and health alone. Enter your details on the quote form and you will see only the plans you qualify for.

Ans: The loan carries on as before. Tell your lender that you are now an NRI, and expect to pay the EMIs from an NRE or NRO account. A loan-cover policy you already hold usually continues if you inform the insurer, but new loan-cover policies may not be offered to NRIs. The simpler way to protect your family from the loan is a term plan whose cover and term match your loan balance and tenure.

Ans: Most insurers accept NRIs from 18 up to 60 or 65. The upper age depends on the plan and the cover you ask for, so check it for the plan you want before you apply.

Ans: NRIs pay tax in India only on income earned or received here: a salary for work done in India, rent from Indian property, capital gains on Indian shares or property, and interest on NRO accounts. Interest on NRE and FCNR accounts is tax-free. For term insurance this means the premium deduction helps only if you have taxable Indian income, while the death benefit is tax-free in India. Ask a tax adviser about your own position.

Ans: Start with how much cover your family needs, then compare plans on premium, the insurer’s claim record, the riders you want and how well it handles NRI applications. The cheapest plan is not always the best one, and you should read what a plan does not cover before you pay. Enter your country of residence on the quote form to see the plans open to you, or ask a Policybazaar advisor to go through them with you.

Ans: Yes. You apply online, upload your documents and do any medical by video call or at a partner lab near you. If you die during the term, the sum assured is paid in rupees to your nominee’s Indian bank account.

Ans: Indian passport holders living abroad, OCI cardholders and people of Indian origin can buy. Citizens of Pakistan and Bangladesh cannot. Each insurer sets its own limits on age, income and countries of residence, so eligibility can differ from one plan to another.

Ans: Under Section 45 of the Insurance Act, once a policy has been in force for three continuous years, the insurer generally cannot reject a claim because of a wrong or missing statement in your application. Fraud is the exception, and the insurer has to prove it. In the first three years, the insurer can look closely at what you disclosed.

Ans: No. You can apply, upload your documents and complete the medical from where you live. Some insurers ask for documents attested by an Indian embassy or a notary. Your relationship manager will tell you before you pay if yours does.

Ans: Yes. List all your existing policies on the application, including any you hold abroad. The insurer compares your total cover with your income. Many people add a second policy later, when a loan or a child increases what their family needs.

Ans: Most have family, loans or property in India. An Indian policy pays in rupees, claims are handled by an Indian insurer your family can reach locally, and the process is built around NRI needs, such as video medicals. Premiums are also often lower than for similar cover abroad. If you pay tax in India, the premium may qualify for a deduction too.

Ans: You get a grace period: 30 days for yearly, half-yearly and quarterly premiums, and 15 days for monthly ones. Your cover continues during it. If nothing is paid by the end, the policy lapses and your family is no longer covered. Most insurers let you revive a lapsed policy within a set period, subject to conditions.

Ans: Yes, if you hold an OCI card. You will need to show it with your US passport and proof of where you live. A few insurers do not accept every nationality, so check before you apply.

Ans: The insurer collects premiums in rupees. Insurers usually accept payment from NRE, NRO or FCNR accounts, and some also take international cards or a transfer from your overseas bank. Your bank converts the amount at its own rate. The first premium often has to come from an account in India. Check which payment methods your insurer accepts before you pay.

Ans: Yes. Your nominee can live in any country. The claim is paid in rupees to an Indian bank account, and they can then transfer it abroad under RBI and FEMA rules.

Ans: Yes. The policy covers your life, so it stays in force however your nominee’s circumstances change. If your nominee moves abroad, update their address and contact details with the insurer, and check that your insurer accepts a nominee living in that country.

Ans: An NRE account holds money you have earned abroad and brought to India in rupees. Both the principal and the interest can be sent back overseas, and the interest is tax-free in India. An NRO account holds income you earn in India, such as rent. Its interest is taxable, and there are limits on sending the principal abroad.

Ans: Yes, in two steps. The insurer first pays in rupees into an Indian bank account. Your family can then transfer it overseas under RBI and FEMA rules. How easy this is depends on how the premiums were paid. Premiums from an NRE account or from funds sent from abroad make the transfer straightforward. Premiums from NRO funds mean the payout goes into an NRO account, which has transfer limits.

Ans: Yes. Give your OCI card and passport with your other documents. You can pay premiums from an NRE, NRO or FCNR account. Age, income and country limits are the same as for other NRIs.

Ans: An expatriate is someone who lives outside their home country, usually for work. On this page it means Indians who work abroad. If you hold an Indian passport or an OCI card, you can buy a term plan from an Indian insurer to protect your family back home.

Ans: The main ones are:

• The payout is made in rupees, to your family in India.
• Your family claims from an Indian insurer, so nobody has to deal with a foreign company.
• You can buy online and do the medical by video call.
• The cover applies worldwide; tell your insurer if you move.
• If you pay tax in India, the premium may qualify for a deduction.

Ans: Yes. The process is the same as for any other NRI. Give your country of residence correctly on the quote form, because insurers decide eligibility and premium partly on it.

Ans: Usually not. Premiums depend on your age, cover, policy term, health and whether you smoke, the same as for a resident Indian. They can rise, or the insurer can decline cover, if you live in or often travel to a country it treats as high-risk, such as a conflict zone.

Ans: It depends on your age, health and the cover you want. Many NRIs do a video or tele-medical from home, and some are asked to visit a lab abroad or in India. If the insurer sends you to its own partner lab, it usually pays for the tests. If you arrange them yourself, you may have to pay.

Ans: Your nominee does not have to travel to India. They inform the insurer, fill in the claim form and send the documents online or by courier. If you died abroad, the death certificate must be attested by the Indian embassy. If you bought through Policybazaar, the nominee can also call our claims helpline (1800-258-5881 in India, +91-124-6166633 from abroad), and a relationship manager helps with the forms and follows the claim with the insurer. The insurer decides the claim.

Ans: IRDAI publishes each life insurer’s claim figures every year in its annual report and statistics handbook. Compare claims paid with claims repudiated, and look at several years, not just one. A single good year tells you little.