Life is full of surprises, both good and bad. If you happen to be staying abroad but wish to safeguard your loved ones in India, a term insurance plan can be one of the wisest things you do. A term insurance for NRI covers you like a safety net that ensures your dear ones in India are economically independent even while you are not there. The best news is that it’s extremely easy for NRIs to purchase term insurance in India, irrespective of where they are based.
In this guide, let’s discuss the process in the easiest manner possible. You would understand why NRIs must purchase term insurance in India, how to purchase it, what documents are required, and the premium to pay.
Contents
- 1 Why Should NRIs Purchase Term Insurance in India?
- 2 Eligibility for NRIs
- 3 How NRIs Can Purchase Term Insurance in India
- 4 Documents Required by NRIs
- 5 NRIs premiums
- 6 Medical Tests for NRIs
- 7 Claim Settlement for NRIs
- 8 Steps to Purchase Term Insurance in India as an NRI
- 9 Tips for NRIs Before Buying
- 10 Conclusion
Why Should NRIs Purchase Term Insurance in India?
If you are an NRI, you may be well-earning abroad, but your spouse, children, or parents might still stay back in India. They rely on you, and in case anything untoward occurs to you, they might have huge financial issues. This is where a term insurance policy acts as a protector.
Some of the major reasons why NRIs must purchase term insurance in India include:
- Financial security for family – Your family gets a lump sum payout if something happens to you.
- Affordable premiums – term insurance plans usually cost less than those in other countries.
- Coverage in multiple countries – Most policies cover death worldwide, so you stay protected even outside India.
- Trust in Indian insurers – Many NRIs feel safer buying insurance from trusted Indian companies.
- Tax benefits – You can claim tax deductions under Section 80C of the Income Tax Act, if applicable.
Eligibility for NRIs
NRIs, PIOs (Individuals of Indian Origin), and OCIs (Overseas Citizens of India) are generally eligible to purchase term insurance in India. Insurance companies can inquire about your current place of residence, occupation, and state of health before issuing a policy.
In general, you should:
- Be between 18 and 65 years old (exact age differs with insurers).
- Be healthy (medical tests might be needed).
- Give valid NRI documents, such as a passport and visa.
How NRIs Can Purchase Term Insurance in India
Purchasing term insurance in India as an NRI is not really complex. You can do it in two primary ways:
1. When You Are Visiting India
This is the most convenient choice. You can meet the insurance company in person or apply online from where you are based in India. Medical tests (if needed) can be easily completed in Indian laboratories.
2. When You Are Overseas
Even when outside India, you can apply online. Insurers permit NRIs to purchase policies from anywhere globally. In such situations:
- You might be required to undergo medical tests in your own country.
- Reports can then be submitted to the insurance company in India.
- At times, the insurers might request you to go to the Indian embassy for validation.
Most of the top insurance companies now have easy online procedures, so it is seamless for NRIs to apply from overseas.
Documents Required by NRIs
To keep things easy, have the following documents handy:
- Passport (copy and original for identification)
- Valid visa or work permit
- Proof of NRI status (PIO/OCI card if so)
- Proof of income (salary slips, bank statements, tax returns)
- Address proof in India and overseas
- Medical reports (in case requested by insurer)
The premium amount for NRIs is based on the same factors as for Indian citizens:
- Age
- Sum assured (coverage)
- Policy term (term)
- Health condition
- Smoking or drinking behaviour
Actually, premiums for NRIs are usually identical to those of Indian citizens. To illustrate, a 30-year-old NRI with no health issues can purchase a ₹1 crore cover for 30 years for as low as ₹700–900 every month.
This makes Indian term plans one of the most affordable in the world, while providing high coverage.
Medical Tests for NRIs
Medical tests are a crucial step. They enable the insurer to know your health status before issuing a policy. Tests commonly requested are:
- Blood pressure check
- Blood sugar level
- Cholesterol test
- ECG or stress test (for greater coverage)
If you are applying from overseas, the insurer may request you to undertake these tests in your home country. Reports can be submitted online or through courier. Some also arrange with local clinics overseas.
Claim Settlement for NRIs
The most significant aspect while selecting term insurance is the claim settlement ratio of the company. This indicates how many claims are settled out of the total claims received.
For instance, if a company has a 98% claim settlement ratio, it indicates that 98 of every 100 claims are settled without difficulty. Always go for insurers with a high claim settlement ratio so that your family encounters no difficulty at the time of claim.
When a claim is filed, your family can send all documents either in India or overseas. Online claim requests are now accepted by most insurers.
Steps to Purchase Term Insurance in India as an NRI
Here’s a step-by-step process:
- Compare policies online: Compare various insurers, coverage, and premium.
- Use a calculator: Website-based term insurance calculators make you view the correct premium for your age group and requirements.
- Fill proposal form: Provide information such as age, income, medical history, and resident country.
- Submit documents: Upload passport, visa, residence proof, and income proof.
- Do medical tests: Either in India or in your country.
- Pay premium: You can pay in Indian Rupees (INR) or some insurers may permit foreign currency payments.
- Policy issued: Once verified, your term plan will be issued by the company.
Tips for NRIs Before Buying
- Choose high coverage: At least 10–15 times your yearly income.
- Select a long policy term: To remain protected till retirement age.
- Verify global coverage: Ensure that the policy covers death abroad.
- Check payment options: Some family members would like to receive a monthly income rather than a lump sum.
- Keep family updated: Inform your nominee about policy terms.
Conclusion
An NRI lives away from home, but his heart stays back with his family in India. One of the easiest and most cost-effective methods of safeguarding them is a term insurance plan. No matter if you are based in the US, UK, UAE, or any other foreign nation, procuring term insurance for NRI in India is now hassle-free and convenient.
With a few simple steps and minimal documents, you can provide your family with peace of mind and financial security. Money can’t buy you back, but it can keep your loved ones strong without you. So, if you are an NRI and still considering term insurance, don’t wait. Begin today, compare the top plans, and choose one that suits you best. Your family’s future is worth this cover.
