Compare & Buy Car, Bike and Health Insurance Online - InsuranceDekho
Claim, renew, manage & moreLogin
Hurry Up!
Save upto ₹54,600 in taxes under 80C & 80D. Buy a term insurance plan now!
View Plans

Guide for NRIs To Buy Term Insurance in India

Updated On Jul 13, 2021

Indians living abroad recognize the essential value of providing a life insurance policy to protect their households' financial future. Realizing this need gap, the Foreign Exchange Management Act (FEMA) has allowed non-resident Indians (NRIs) and People of Indian Origin (PIOs) to purchase life insurance policies (term plans) in India.NRI term insurance is becoming a popular insurance plan in the country because of the flexibility and advantages.

Factors To Remember Prior To Purchase Of Term Insurance In India

Several insurance providers are now selling a range of customized services to attract NRI customers at competitive rates. Before you get down to choosing a package that best suits your desires, there are few things you need to remember first.

1. Eligibility - NRI can be described as a person who has lived outside the country for a certain amount of time. Person of Indian Origin (PIO) is identified as a person from any other country except Pakistan or Bangladesh, subject to the following conditions:

  • At any point in your life, you had an Indian passport.
  • Under the Citizenship Act of 1965, you or your parents or ancestors are residents of India.
  • You are married to an Indian resident.
  • If you are a non-resident of India, you need a valid Indian passport. If you are a PIO who satisfies the above criteria, you are entitled to qualify for a life insurance purchase.

2. Medical Examination - Before you buy a life insurance plan, you will have to undergo a medical test like a resident Indian. This can be completed in one of the following two ways:

  • You are visiting India to undergo a medical evaluation.
  • You can be checked in each of the partner centres of the insurer in your country of residence.
  • You complete the medical review in the country of residence and submit the reports to India's insurer.

3. Premium Payment - Many times, people living outside India have families back home who can track and ensure that banks pay premiums in India. The premium may be charged by a non-resident ordinary (NRO) account or an NRE/Foreign Currency Non-Repatriable (FCNR) account. However, if the life insurance scheme is bought in foreign currencies, the premium will be deducted from the NRE or FCNR account.

4. Cost - People residing in countries that are vulnerable to an excess of political uncertainty (also known as High-Risk Countries) will prove to be a greater liability to the insured and would thus be expected to pay a higher premium rate. If you live in a country known for little to no uncertainty, the premium amount will usually be much lower.

5. Death and Maturity Benefits - Life insurance policy bought by NRIs from insurance providers in India protects loss of life irrespective of where you are situated when you pass. The death benefit will be given in Rupees or in the currency of the country where you live. Like a standard life insurance contract, the nominee will have to request the required paperwork to comply with the policy terms.

6. Tax Regulations - NRI insurance policies come with tax incentives in India. However, unlike most other nations, the term insurance coverage is not 100% tax-free. You may receive tax savings on the sum assured obtained by the nominee, but all incentives or other benefits are taxable.

7. Claim Settlement Ratio - The ratio of how many claims the insurance provider has favourably settled to the number of claims filed. The higher the settlement percentage, the higher the comfort you will derive from the insurer. Understanding which insurance company has a higher claims payout ratio and the amount of time they take to settle the claim can help you make the right decision.


A life insurance policy can be a perfect option for NRIs and PIOs to provide a security layer to their family members in India. Remember the factors listed above and your financial condition, Buy a life insurance policy in India depending on your budget and your specifications.

Also read 

Why Do You Need A Term Insurance Plan?

Types of Term Insurance Plans

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.        

Popularly Opted Term Insurance Sum Assured

People Also Read

Must BuyMust Buy

Why to Buy Life Insurance Policy Online from InsuranceDekho

  • Tax benefit upto 1,50,000*
  • Claim support everyday 10AM-7PM
  • 50 Lacs+ happy customers
Find the right life insurance for you
By clicking, I agree to *terms & conditions  and privacy policy.
Find the right life insurance for you
By clicking, I agree to *terms & conditions  and privacy policy.