Parent protection policies in India for NRIs

Parent protection policies in India for NRIs

July 29, 2019 9:13 am,

In today’s world, with a large number of NRIs working and earning a living abroad, a constant need for such individuals is to have insurance policies that protect their families and parents in India. Parent protection policies in India for NRIs also called as term plans are available for investment and savings.

Reasons to buy a term insurance or protection plan:

  • High life insurance amount – Term insurance provides the option to take a high cover. For example, if the annual income is Rs. 5 lakhs, it is possible to take a cover-up to Rs. 50 lakhs.
  • Cost of insurance policy – Protection plans usually have a lower premium when compared to other types of insurance policies.
  • Tax benefits – The term plans provide tax savings under the Income Tax act 1961, under section 80C. The plans that cover critical illness provide additional tax benefits under section 80D.
  • Cover against critical illness – There are term policies that have good features that cover critical illness for a small additional premium.
  • Support for a case of disability – The insurance company pays your future premiums in case of total and permanent disability.

Popular Protection or Term Insurance policies available in India:

Some of the popular protection or term insurance policies and Parent protection policies in India for NRIs are:

ICICI Prulife iProtect Smart plan –

  • So, this term plan provides coverage until the age of 99 years.
  • The plan is for NRIs in Australia, Canada, Singapore, UAE, New Zealand, Malaysia, Norway, Hong Kong, Phillippines and Iceland.
  • Subscription to the policy is easy with the KYC documentation that has proof of residence in India and can be done online.
  • Premium payments happen through NRE/NRO account or even using local currency Amex, Visa Master card, credit or debit cards.
  • Communication is done through email or phone with international customer service helpdesk and correspondence with local address in India.
  • So, claims are paid in Indian Rupees to the nominee’s NRE/NRO account.
  • If the nominee is also NRI or if the nominee is Indian, then the claim amount is paid to the bank account in India.
  • Tax benefits through Income tax act 1961 and applicable sections in 80C are possible as per the tax status of the individual.
  • Hence, on insurance payout, Tax is deducted at source (TDS) on any sum paid to non-resident Indian only if the policy is not exempt under section 10(10D).
  • So, the tax will not be deducted where DTAA benefit is available as per section 90.
  • If the subscriber has submitted valid form 10F and tax residency certificate.

HDFC Life Click2Protect 3D Plus –

  • Click2Protect 3D Plus plan provides a life long cover that covers 3D – Death, Disability and Disease
  • It provides a lumpsum payout on death or diagnosis of terminal illness
  • Option to get monthly income for financial stability
  • Provides a waiver of premium on accidental total disability or critical illness
  • Hence, the policy is further customized with 9 additional options and 2 riders.
  • It has an option for special premium rates for female subscribers
  • Provision for flexibility to increase cover using the top-up option
  • Tax benefits as per the existing tax laws.

Hence, there are many other plans offered by other insurance companies. So, all these can be explored and chosen as per the individual needs.

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