Why Do Many NRIs Prefer Buying Health Insurance in India..?

 

Why Many NRIs Prefer Buying Health Insurance in India..?

Anand Parthasarathi, 

Managing Partner, Aramm Finserv

 

For Non-Resident Indians (NRIs), purchasing health insurance in India is no longer just about meeting medical expenses. It has become a smart financial planning decision that offers family protection, long-term financial security, and tax benefits.

In particular, NRIs with elderly parents living in India and those planning to return to India in the future are increasingly opting for health insurance policies issued in India.

 

Key Reasons Why NRIs Buy Health Insurance in India

 

1. Healthcare Protection for Parents

 

A large number of NRIs have parents residing in India. As people age, healthcare expenses continue to rise significantly. Having a health insurance policy helps protect families from unexpected financial burdens arising from hospitalization and medical treatment.

 

Expenses related to hospital admissions, surgeries, intensive care, cancer treatment, and other major illnesses can run into several lakhs of rupees. A suitable health insurance policy can cover a substantial portion of these costs.

 

2. Planning for a Future Return to India

Obtaining permanent residency in several countries, particularly in the Gulf region, is often difficult. Many NRIs eventually plan to return to India after completing their overseas careers.

 

Purchasing health insurance well in advance offers several advantages:

·         Waiting periods are likely to be completed before the policy is needed.

·         It becomes easier to obtain coverage before advancing age creates eligibility challenges.

·         Coverage for pre-existing diseases becomes available sooner after the waiting period.

 

3. Affordable Premiums

Compared with countries such as the United States, the United Kingdom, Canada, and Australia, health insurance premiums in India are considerably more affordable.

At the same time, policyholders can access treatment at many leading hospitals across the country.

 

4. Easier Claim Settlement in India

Health insurance policies in India offer several conveniences, including:

·         Cashless hospitalization.

·         Extensive hospital networks.

·         Faster and simpler claim settlement.

These features reduce the financial burden on family members during medical emergencies.

 

Can Indian Health Insurance Be Used Abroad?

Although a few Indian health insurance plans provide limited overseas coverage, they are generally not sufficient for most NRIs.

The primary reasons include:

·         Medical treatment abroad is significantly more expensive.

·         The sum insured, denominated in Indian Rupees, may not adequately cover overseas healthcare costs.

·         Indian insurers often have limited tie-ups with foreign hospitals.

·         Currency exchange fluctuations may increase the financial burden.

For this reason, many NRIs prefer to maintain health insurance in their country of residence while also purchasing a separate policy in India for themselves or their family members.

 

Special Features Offered by Insurers for NRIs

To attract NRI customers, many insurance companies have introduced special facilities and benefits, including:

·         Health insurance plans for parents.

·         Family floater policies.

·         Online policy purchase facilities.

·         Acceptance of international documentation.

·         Simple policy renewal processes.

·         Premium discounts on selected plans.

 

Tax Benefits Available to NRIs

NRIs earning taxable income in India can claim tax deductions on health insurance premiums paid.

However, these deductions are available only under the Old Tax Regime.

 

Tax Deduction Limits

Premium Paid For	Maximum Tax Deduction
Self and family	₹25,000
Senior citizen health insurance	₹50,000
Preventive health check-ups	Up to ₹5,000

 

Important Points While Paying Premiums

Health insurance premiums should be paid through approved banking channels such as:

·         NRE Account

·         NRO Account

·         FCNR Account

·         Other approved digital payment methods

 

Which Income Tax Return (ITR) Form Should NRIs File?

Selecting the correct Income Tax Return (ITR) form is essential for NRIs earning income in India.

Nature of Income	Applicable ITR Form
Salary, rental income, capital gains, interest income, and other non-business income	ITR-2
Business or professional income in India	ITR-3

 

Factors to Consider Before Buying Health Insurance

Before purchasing a health insurance policy, NRIs should carefully evaluate the following:

·         Is the sum insured adequate?

·         What is the waiting period?

·         When does coverage for pre-existing diseases begin?

·         Which hospitals are included in the insurer's network?

·         Is there any room rent limit?

·         Is the sum insured restored after a claim?

·         Does the policy offer a No Claim Bonus?

·         Is lifelong renewal available?

 

Major Benefits of Buying Health Insurance in India

Benefit	Description
Protection for parents	Covers unexpected medical expenses for parents living in India.
Affordable premiums	Significantly lower than premiums in many developed countries.
Easy claims	Cashless treatment at network hospitals in India.
Tax benefits	Eligible for deductions under the Old Tax Regime.
Future planning	Continuous health coverage for those planning to return to India.
Peace of mind	Ensures financial security for family members despite living abroad.

For today's NRIs, purchasing health insurance in India is no longer viewed as an expense but as a long-term financial investment. It provides healthcare security, valuable tax benefits, and peace of mind, particularly for those with parents living in India, individuals planning to return to the country, and NRIs earning taxable income in India.

 

Choosing the right policy based on age, health condition, family requirements, and expected medical expenses can significantly reduce the financial impact of unforeseen medical emergencies in the future.

 

If you'd like, I can also convert this into a newspaper-style article, magazine feature, or website/blog format with a more engaging introduction and smoother narrative flow.

 

For More details and policy taken

 

Anand Parthasarathi, 

Managing Partner, Aramm Finserv

 

He provides services in life insurance, health insurance, mutual funds, and financial planning.

 

To read articles written by Anand Parthasarathi in the leading personal finance magazine Naanayam Vikatan, please visit: https://bit.ly/4661ukl

 

ARN-132636

 

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E mail : anand@arammfinserv.com

 

Website : www.arammfinserv.com

 

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