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Why NRIs should invest in a Dollar based Life Insurance or Investments in UAE?

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 funds, Stocks or Bonds is the continually depreciating Rupee and repatriation of money.

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;

Ideal hedge against the falling Indian Rupee

Indian Rupee has depreciated by 33.44 % between 1st March 2011 and March 2016, losing more than 6.50% in value each year.Onada-Rupee-1.png

 

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 currency, which is continuously depreciating?

Such plans are handy for protecting the following;

  1. Medical Expenses for treatment of critical illness like Cancer, Kidney Failure Etc. in UAE or abroad.
  2. Education costs of children who may be studying here or in UK, US, Australia, Canada etc.…
  3. For paying off liabilities like mortgages, personal loans car loan & business loans in UAE
  4. To manage immigration expenses to either back to India or any other country.

The money they would get after currency exchange from an insurance policy in India would be much less. Thus defeating the whole purpose of having insurance in place.

Comprehensive 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 ample room for misinterpretation and mis-selling.

Insurance plans in UAE have a wide and 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.

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.

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 more economical in UAE than in India.

Many insurance providers like Aviva, HDFC Standard Life, Aegon Religare, Birla Sunlife, max New York, LIC of India, ICICI Prudential, in India provide online term insurance plans at very attractive rates, but most of these do not cover NRI's.

Only offline plans from LIC of India, and Birla 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 Plans cover up to the age of 74; a few also cover up to age 100.

The Whole of life plans from Zurich, Metlife and Salama provide a Whole of Life cover for both life cover and critical illness, providing an ideal protection solution.

Simple, Fast and Transparent Claim Process 

The claim process is simple, with access to 24/7 international call centre assistance from most of 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.

Free Consultation with Damodhar Mata

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