More NRIs buy term life covers from desi insurers

CHENNAI: Post-pandemic demand for life cover in India from NRIs has risen thanks to low term insurance rates which continue to be competitive despite an increase in rates by some insurers following the Covid-19 outbreak.


Bajaj Allianz Life has seen its NRI premium income during the period April 21 to June 21, grow 59% over the same period last year.

In absolute numbers, the increase is from Rs 115 crore in 2020 to Rs 182 crore in 2021. According to Chugh, this is because overseas rates are on average 20% higher than what customers pay in India.

Depending on where the NRI resides, they may find Indian term insurance rates cheaper by 20-50. Exide Life Insurance, which has a smaller base, has seen its NRI premium double to Rs 20 crore in April-August, 21 from April-August 20.

The company’s director of strategy Sanjay Tiwari said “Despite premium rates having gone up post the outbreak of Covid-19 pandemic, it is still 40%-50% cheaper to purchase a term policy in India.” He adds that the high settlement ratio of 98.54% also reassures buyers.

“We see NRI demand from other Asian countries and Europe as well, but it is largely driven by those working in the UAE,” Tiwari added.

According to agents, those NRIs having dependent families or outstanding home loans in India are more likely to buy term cover here than those settled abroad.

Sajja Praveen Chowdary, head of term life insurance, Policybazaar.com says the premium paid for purchasing a term life cover in India is cheaper by 20%-40%, as compared to any other country. Chowdary says.

The only downside is that NRIs (except those in UAE and Singapore) have to bear the cost of pre-acceptance medical tests. These tests are particularly expensive in US and European nations and insurers are unwilling to reimburse them.

Premium on term covers has risen by 25% post-pandemic. Re-insurers have taken a tough stance on accepting covers especially after the devastating impact of the second Covid wave on human life.