Coverage Needs for Family in India
NRIs can benefit from life insurance policies purchased in India. The benefit paid by the policy can be used by your family can use for their financial needs. Life insurance companies offer a range of options to choose from. For instance,
- You can choose term insurance plans if you aim to provide financial security to your family in your absence
- Endowment or money back insurance plans help you create a stable corpus for your and your family’s financial goals.
- If you are looking for life insurance coverage and exposure in Indian markets, you can choose ULIPs
Besides the variety of plans, you can choose a sum assured aligned with your family's financial needs. Deciding the right coverage amount, however, depends on factors such as:
- Current and future financial needs of your family back home
- Outstanding liabilities, such as loans or debts
- Lifestyle expenses and children's education costs
- Inflation rate, which affects the future value of money
So, with a choice of plans and the flexibility of choosing the coverage, you can buy life insurance plans for you and your family’s financial needs.
Affordability of INR-Priced Policies
NRIs in Australia often opt to purchase life insurance plans in India. One of the most compelling reasons for this preference the affordability of plans in India. Thanks to the currency exchange rate between the Australian Dollar and the Indian Rupee (INR), premiums for Indian policies often work out to be lower.
Remember: When planning to purchase a life insurance policy, be sure to conduct a currency comparison to gain a detailed understanding of how life insurance policies in INR can impact your budget.
Claim Settlement Ease via Bajaj Allianz Life
For those with post-retirement life plans in India or strong family ties in the country, they often prefer life insurance policies in India. One of the reasons is the ease of the claim settlement process.
As per IRDAI mandate, death claims which do not require investigation must be settled within 15 days, and early death claims that require investigation must be settled within 45 days.3
This ease of process makes it quite comfortable for NRIs to receive their life insurance benefits. At Bajaj Allianz Life, we ensure that the life insurance claim process is quick, easy, and simple. Our goal is to ensure a smooth and hassle-free process for our customers. As of the 2024-25 financial year, Bajaj Allianz Life has a claim settlement ratio* of 99.29%. This high claim settlement ratio indicates our customer-first approach.
Tax Perspective & DTAA 2
India and Australia signed the Double Taxation Avoidance Agreement (DTAA) in 1991. The purpose of this agreement is to avoid double taxation of NRIs in Australia or Australians in India. This agreement helps residents of both countries avoid paying double taxes if they have already paid tax in either of the countries. Life Insurance for NRIs in Australia also falls under this category. The death benefit from life insurance is not taxable in India. So, double taxation is usually not a concern in this regard.
Apart from DTAA, India also offers tax benefits under Section 80C of the Income Tax Act of 1961. Therefore, you can claim a deduction for life insurance premiums if they do not exceed 10% of the sum assured amount under old tax regime. The policy must be in the name of the NRI, their spouse, or their children to avail these benefits.
Customer Voice: Story from Sydney
Rajeev Mehra, a 33-year-old IT consultant, became a father last year. It was then that he decided to secure the financial well-being of his family back in India with a life insurance policy. After a thorough comparison between life insurance plans in India and Australia, Rajeev decided to buy life insurance for NRIs in India. The premium was under his budget, and he secured a life insurance policy with a ₹2 crore sum assured.
Rajeev said that the one-month premium for life insurance in India is well within his budget. This affordability is what attracted his decision. He said, “Knowing my family's financial future is secure gives me peace of mind. The easy claim settlement process, affordable plans, and tax benefits are some of the reasons that this is the right life insurance plan for him.”
Rajeev’s story is just one among many. He made a smart decision that will reflect in his finances for years to come.
FAQs
Can NRIs in Australia purchase life insurance plans in India?
Yes, NRIs living in Australia can purchase life insurance plans in India.
How can payment of premiums be done for life insurance by NRIs in Australia?
NRIs in Australia can pay through their NRE or NRO account without any hassle. Some insurance companies may also accept internet banking or international cards.
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