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Term insurance is gaining popularity among Indians because of getting higher benefits at a much lower premium compared to regular life insurance. While the importance of having term insurance is well documented among the resident Indians, many NRIs seem to be less aware of the benefits they can avail of by having term life insurance in India.
Besides the usual benefits, there are good additional reasons for NRIs to buy term life insurance in India.
1. Flexible Regulations
Regulations regarding buying insurance products, including term insurance, in India are extremely favourable for NRIs, PIOs(Persons of Indian Origin), and even citizens of other countries.
As per Foreign Exchange Management Act (FEMA), residents of foreign countries can buy any type of insurance in India regardless of whether they are Indian citizens or not.
An NRI need not have to be physically present in India while buying an insurance plan.
2. Affordable Price
Term insurance plans in India are relatively cheaper than in many other countries. Therefore, NRIs are likely to get a better deal while buying term plans in India. However, if you live in a high-risk country, the premiums may go up.
3. Trust and Faith in Home Brand
Indians who recently became NRIs by moving to a foreign country can be quite overwhelmed with various insurance firms in that country that can be unfamiliar to them. As a result, NRIs may find it hard to trust such insurance firms regardless of their popularity and track record.
On the contrary, NRIs can find it easy to trust a popular insurance service provider in India as they are likely to be aware of the reputation of such firms. Knowing the reputation beforehand, NRIs can be at peace by buying a term insurance plan from such insurance firms.
4. Securing Family’s Future
As an NRI, you toil in a foreign land so that you can better provide for your family back home. You want them to lead a comfortable life, but what would happen to them if something unfortunate happens to you and you are no longer around.
Therefore, it is always advisable to financially secure your family’s future by buying a good term insurance plan that can provide adequate financial cover in your absence.
5. Tax Benefits for NRIs
Not just resident Indians but NRIs too can enjoy some tax benefits on both the premiums paid and the sum assured received. While the premium paid is deducted from taxable Indian income under section 80C, section 10 (10D) allows exemptions on the assured sum received subject to certain terms and conditions.
The Final Verdict
If you are an NRI, buying a term plan can be very important for you from many perspectives. Above all, you get to emotionally relieve yourself in knowing that your family will be safe and taken care of even when you are not around.
