How NRIs Can Choose the Right Term Insurance Plan in India: Being far away from your home is not always a piece of cake. You relocate to a foreign country and toil to provide a good life for your family left behind in India.

However, have you considered the situation of your family if you were not there tomorrow? A term insurance policy is what you need at this point. It is by far the most straightforward and transparent kind of life insurance.

You simply contribute a small amount of money every year, and the insurance company, on the other hand, ensures that if the unfortunate event of your absence occurs, they will compensate your family with a large sum of money.

Purchasing term insurance for NRI clients in India has been made very quick and cheap. Actually, policies in India can be even 50% cheaper than policies in the UAE, the US, or Singapore.

If you intend to secure your family even when you are miles away, then the following simple guide will show you how to select the best policy.

1. Review the Claim Settlement Ratio (CSR)

This is the most critical figure to consider. The Claim Settlement Ratio informs you of what percentage of claims an insurance company actually paid among the 100 claims it received.

Let us say a firm has a CSR of 99%; this implies they were able to pay 99 out of 100 claims. A company that has a ratio above 97% over the last three years should always be your first choice. This will assure you that even in your absence, your family will not have to struggle to obtain the money.

2. Decide on the Right Cover Amount

How much money would your family require? Basically, checking your yearly income should be a good starting point. The amount of insurance you decide to cover should be around 10 to 15 times your gross annual salary.

If your annual income is ₹20 lakh, then your family should be covered with an insurance amount of at least ₹2 crore and ₹3 crore. This sum would be sufficient to take care of any outstanding home loans, cover daily necessities, and support your children’s tertiary education entirely without any financial worries.

3. Selecting the Right Bank Account to Pay Premiums

As an NRI, you have the privilege to pay insurance premiums through either your Non-Resident External (NRE) account or your Non-Resident Ordinary (NRO) account.

Ideally, you should stick to your NRE account. Paying from an NRE account, as per the policy rules, significantly simplifies the process for your family to transfer the claim proceeds back to whatever country they are residing in at the time. On the contrary, disbursing funds through an NRO account can sometimes result in additional paperwork down the line.

4. Be on the lookout for the 0% GST Benefit

Here is the icing on the cake for those of you residing overseas. If you opt for an Indian term insurance plan and make your premium payment in foreign currency via your NRE account, then you are exempt from the payment of the regular 18% Goods and Services Tax (GST). This way, you save a substantial amount of money every single year, which is one of the reasons Indian policies are very cost-effective.

How to Buy: Step-by-step

Gone are the days when you had to take a flight to Delhi or Mumbai just to get your health check done. The whole process is done online.

Step 1: Check For Best Deals Online

Go to an insurance comparison site to check the different companies by their price and settlement ratio.

Step 2: Fill Out The Form Truthfully

Complete the online application form. Be completely truthful about your health, your lifestyle habits like smoking, and your exact overseas address. Hiding the facts can create problems when your family has to make a claim.

Step 3: Submit Your Documents

Submit scanned copies of your Indian passport, your foreign visa or resident permit, your income proofs such as salary slips, and bank account statements.

Step 4: Do the Video Medical Test

Most leading companies have stopped requiring physical medical tests. You can easily arrange for a telemedical check or video call consultation from your home abroad.

Helpful Add-ons to Think About

When you purchase term insurance for NRI individuals, you have the opportunity to supplement your basic plan with additional protections by simply making a small extra payment. These extras are called riders.

• Critical Illness Rider: Upon your diagnosis of a serious illness such as cancer, the insurance policy will immediately pay a lump sum amount to you for covering the hospital expenses.
• Accidental Death Rider: Your family will be given an additional sum of money on top of the main coverage amount if your death results from an accident.
• Waiver of Premium: If you become seriously disabled and are no longer able to work, the insurer will not require you to pay any of your future premiums, but your coverage will continue without interruption.

A Quick Tip on Payouts:

It is your decision how your family receives the money. If your family members are good at handling money, opt for a lump sum payment at one time. If they are going to need ongoing financial help, then you can organize it so they receive a fixed monthly income.

Buy a term insurance plan and you will have given the most precious gift of security to your loved ones. Doing so will make sure that even in your absence your parents, spouse, and children will not be forced to relinquish their dreams or ask for financial assistance by anyone. Set aside some time this weekend, look up the best ways to buy online, and lock in their tomorrow today.