Indian Insurance Policies for NRIs Living Abroad: Rules and Claims
LIC, HDFC Life and other Indian insurers allow NRIs to keep existing policies abroad. But premiums, claims and nominee rules differ from resident policies.
Can NRIs Keep Indian Life Insurance Policies?
Yes — NRIs are permitted to hold and continue paying premiums on Indian life insurance policies (term, whole life, endowment, ULIP) while living abroad. There is no FEMA restriction on maintaining an existing Indian insurance policy after becoming NRI. You can also buy new policies from Indian insurers while abroad, though the process and medical requirements differ.
Premium Payment from Abroad
Premiums on Indian insurance policies can be paid by NRIs through:
- NRE or NRO account: Standing instruction from your Indian bank account for auto-debit.
- Foreign currency remittance: Some insurers accept direct payment from a foreign bank account via wire transfer, converting at the prevailing rate.
- Online portal: LIC, HDFC Life, ICICI Prudential all have NRI-specific online portals where you can pay by international debit/credit card.
Premiums paid from NRE funds are repatriable as part of the maturity proceeds. Premiums paid from NRO funds are subject to the standard USD 1M/year repatriation limit on maturity.
Tax Treatment of Premiums
Under Section 80C of the Income Tax Act, life insurance premiums qualify for deduction up to ₹1.5 lakh per year. However, this deduction is only available if you have taxable income in India to offset it against. Most NRIs with only NRO interest income may have limited or no use for this deduction. The maturity proceeds are tax-free under Section 10(10D) provided the sum assured is at least 10x the annual premium (for policies issued after April 1, 2012).
LIC for NRIs: Special Considerations
LIC has specific underwriting rules for NRIs. When purchasing a new LIC policy from abroad:
- You must complete the medical examination in India or at an LIC-approved medical facility in your country of residence.
- The policy will specify whether it covers death outside India — most LIC policies cover death globally without restriction, but check your specific policy wording.
- Maturity proceeds are paid in INR to your NRO account. Repatriation requires the standard Form 15CA/15CB process for amounts above ₹5 lakh.
Claim Settlement Process from Abroad
In the event of a death claim:
- The nominee (who may be in India) initiates the claim by submitting the death claim form, original policy document, death certificate (apostilled if issued abroad), and nominee's identity proof.
- For maturity or survival benefit claims, submit the policy discharge voucher, identity proof, and bank details for NRO account credit.
- Some insurers now accept claims online — LIC's e-portal allows upload of scanned documents.
Indian Health Insurance from Abroad
Indian health insurance policies do not cover treatment outside India unless they specifically include international coverage (rare and expensive). For NRIs:
- Maintain a local European/international health insurance policy for day-to-day coverage abroad.
- Keep or take a top-up Indian health policy that covers you during India visits — particularly useful for covering parents under a family floater plan.
- Some insurers (Niva Bupa, HDFC ERGO) offer NRI-specific policies covering both India visits and repatriation costs.
Use the NRI Tools Document Tracker to track your Indian insurance policy renewal dates and never miss a premium — open the document tracker.