When it comes to NRI insurance and investment, many Indians prefer investing back home in India.
The challenge with sending money to India for investing in FD’s, Mutual finds, Stocks or Bonds is the constantly depriciating Rupee.
A wiser alternative would be to Invest in US Dollar denominated investment and insurance plans in UAE.
The following are some of the benefits of buying a US Dollar based Life Insurance plan in UAE from companies like Zurich International Life, LIC International, Friends Provident and Oman Insurance;
1. Ideal hedge against the falling Indian Rupee
Indian Rupee has depreciated by 33.44 % since 1st March 2011, losing more than 6.50% in value each year.
The falling rupee – how does it affect me?
- Indian Rupee was trading at Rs. 10.65 against AED on 5th November 2007
- On 27th Feb it was trading at 18.73 against Dirham
- Has lost more than 73% of its value
If you purchased an insurance plan for INR 1 Cr in 2007 to protect your family, with an exchange rate of INR 39.45 per Dollar, amounting to $253,485/-
Its current value in US Dollars would be $149,857/- at an exchange rate of INR 66.73 per Dollar*
If you had purchased a US Dollar denominated policy for $253,485/-, its current value in INR would be 1,69,15,054/-*
(*based on exchange rates as on 24th October 2016)
AS an NRI, when you have an option of investing in a USD denominated insurance or investment! Why would you want to invest in a currency, which is depreciating constantly?
Such plans are very useful for protecting the following;
- Medical Expenses for treatment of critical illness like Cancer, Kidney Failure Etc. in UAE or abroad.
- Education costs of children who may be studying here or in UK, US, Australia, Canada etc…
- For paying off liabilities like mortgages, personal loans car loan business loan in UAE
- To manage immigration expenses to either back to India or to any other country.
The money they would get after currency exchange from an insurance policy in India would be much less. They defeating the whole purpose of having an insurance in place.
2. Wide Scope of Critical Illness Cover :
Insurance plans in India have a limited scope of Critical Illness cover. The terms of critical illness cover not well defined, leaving an ample room for misinterpretation and mis-selling.
Insurance plans in UAE have a wide and clearly defined scope of Critical Illness cover on par with international standards.
Some companies cover up to 36 Critical illness, including Permanent Total Disability.
Also the concept is relatively very new to Indian Insurance companies, with very little or no data or history on claims.
3. Offshore Advantage :
Most of the insurance plans in UAE are offshore based, hence they are portable around the world. The claim proceeds can be paid tax free into the account chosen by the beneficiaries.
Being offshore plans, these plans are out of Shari’a law’s purview. They ensure that the beneficiaries get the claims proceeds without any hassles.
4. Lower Costs :
Thanks to the higher life expectancy in UAE, better living conditions and quicker access to emergency medical assistance, the cost of Life insurance is lower in UAE, than in India.
There are many insurance providers in India who provide online term insurance plans like Aviva, HDFC Standard Life, Aegon Religare, Birla Sunlife, max New York, LIC of India, ICICI Prudential, at very attractive rates, but most of these do not cover NRI’s.
Only offline plans from LIC of India, and Brila Sunlife and ICICI prudential cover NRI’s.
The Whole of Life Insurance
The cover items of insurance plans in UAE are longer than that of India. Most term Assurance Plan cover upto the age of 74, a few also cover upto age 100.
5. Simple, Fast and Transparent Claim Process :
The claim process is simple, with access to 24/7 international call centre assistance from most if the providers, clearly defined claim processes.
To know more about Dollar based NRI Insurance and Investment plans in UAE, contact Damodhar Mata on +97150-2285405 or register to arrange a free initial meeting.