4 Things to Know Before You Invest in India as An NRI

4 Things to Know Before You Invest in India as An NRI

Have you ever imagined who will take care of your liabilities and responsibilities, if you are not around? The thought itself is discomforting; therefore, think about your family and how will they be able to handle the emotional trauma of losing you and deal with the financial stress alongside. 

It is here when purchasing a term insurance plan can be the most crucial decision of your life. In simple words, term insurance policy is a definitive financial safety net for your family in case of your sudden demise. Term insurance is the cheapest form of insurance, which provides death benefits to the family of the insured person for a defined period. In addition to Indian citizens, Non-Resident Indians (NRIs) are also eligible to avail term insurance. 

Procedure

You can apply for an NRI Term Insurance Policy in two ways:

  • You (an NRI) can purchase the policy whenever visiting India. Once you complete the formalities of the insurance policy, it will be considered as any other policy availed by an Indian citizen.
  • An NRI can even purchase the policy in the country he is presently residing via Mail Order Business.  The notary and an official of the Indian Embassy verify the procedure, and students can even approach the dean or supervisor for verification.

Term Plans For NRI

Term insurance for NRI is specifically for people who reside outside our country and want to secure their family’s future in their absence. Most of the policies are available online and do not require you to undergo medical tests. Term insurance plans are pure protection plans.  Non-Resident Indians can purchase most of the term plans available in India. Some companies have streamlined their process to issue the term insurance to the NRIs. 

Term Plans For NRI

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Let’s look at the features of some of the insurance companies that offer term insurance for NRIs:

  • Max Life Insurance

Max Life Insurance offers comprehensive and affordable term insurance for NRIs to invest as well as gain from India’s growth. A person of Indian origin (except Bangladesh and Pakistan) and foreign nationals can also avail of this policy. 

Features:

  • Term plans usually have a minimum entry age of 18 years; that is, you can buy term insurance cover as soon as you hit adult age
  • Save Tax U/S 80

You can save tax on your premium payment. Critical illness premium help you save tax under section 80D

  • Cancer and heart attack are some of the many diseases which can be life-threatening. Critical illness cover is available on payment of additional premium
  • You can continue your term insurance plan to upto 85 years of age with Max Life Insurance

Mode Of Payment

You can pay in Indian Rupees from any of your Indian bank accounts held in your name by a cheque of:

  • Non-Resident (External) Rupee Account (NRE Account)
  • Non-Resident Ordinary Account (NRO Account)

Kotak Life Insurance

Kotak offers Kotak Preferred Term Plan and Kotak Term Insurance to NRI’s. It offers NRIs an option to invest in India and to reap the benefits of timely investments.

Features:

  • Flexibility in premium payment options
  • Eligibility to apply within 18-65 years of age
  • You can avail tax benefits under the Income Tax Act under Section 80C for the premiums paid and under Section 10(10D) for the death benefits received by the nominee
  • Insured can opt for Immediate Payout or Recurring Payout.
  • You can increase or decrease the level of cover as per your requirement
  • Critical Illness, Accidental Death and Disability benefits available on payment of additional premiums 

ICICI Pru iProtect

ICICI bank offers ICICI Pru iProtect term insurance for NRIs. This policy can be bought online at your convenience. The minimum age to purchase this policy is 20 years, with a maturity age of a maximum of 75 years. You can avail tax benefits under the Income Tax Act under Section 80C for the premiums paid.

Features:

    • Affordable premiums
    • Special premium rates for non-tobacco users
    • The additional payout on death due to accident

Bajaj Allianz iSecure

Bajaj Allianz offers iSecure term insurance for NRIs. It gives you a level term cover for a high sum at a low cost. 

Features:

  • Eligibility is 18-65 years to purchase this term insurance
  • Premiums paid are eligible for tax benefits under Section 80C of the Income Tax Act, and Death benefits are also available for tax benefits or exemptions under Section 10(10D) of the Income Tax Act
  • Minimum Sum Assured of Rs.2.5 lakhs for general category and Rs.20 lakhs for categories divided by a preferred non-smoker, non-smoker, and smoker
  • The nominee can avail the death benefit in equal monthly installments over 5 or 10 years 

The popularity of term insurance for NRIs has to lead to various companies offering competitive plans to suit the needs of NRIs and emphasizing on the importance of insurance. So, compare and choose wisely to make the best use of term insurance. 

About the Author: Ajay D

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