Health Insurance policy for NRIs
You have been living abroad. Of late, you have started thinking about buying a health insurance policy in India. You are in the right path if you are thinking so. It is imperative for NRIs to have a valid health insurance policy in India because if you ever return to India, then you will require one. A health insurance policy can be beyond your reach when you return because of some of the eligibility conditions. Age-limit is an example. If you have crossed the age-limit at the of your India return, then you can rule out buying a health insurance plan for yourself. And, you will have to pay from your pocket for all your medical expenses. The second reason is tax benefit under Section 80D of the Income Tax A– yes that is applicable to NRIs as well.
Why it is important for NRIs to have health insurance in India
Having a health insurance plan is very important today. As per the contract between the insured and the insurer, the policyholder pays a premium to the health insurance company and in return the insurer covers the expenses for the medical treatment of the insured.
If you are staying outside the country, even then buying a health insurance plan is essential. Imagine this situation: You, along with your family, are on a long visit to India. One of you fall sick and need hospitalization. In the absence of a medical insurance, you will have to pay for the expenses from your pocket.
Are NRIs eligible to buy health insurance in India?
Yes, the NRIs are eligible to buy health insurance policy in India. However, as per IRDAI guidelines, the policy can be used for treatment that are done in India, and not outside the country. For example, if you stay in the UK, you cannot use the policy to cover your medical bills in the case of hospitalisation. The terms and conditions for a medical insurance policy meant for NRIs are different from the policies for Indian citizens. In the fine print, such a clause is usually referred as ‘geographical restrictions. However, some health insurance companies have introduced policies that cover expenses for specific treatments (like cancer, organ transplant etc.) done outside the country.
Also, NRIs need to understand the Foreign Exchange Management Act (FEMA) while scouting for a health plan in India. FEMA regulations mandate that the claim amount to be repatriated should be to the extent of the total premium paid in foreign currency. Read all the terms and conditions carefully before buying or renewing a policy.
For claims settlements, the amount insured may be credited to the person’s foreign bank account or to his resident foreign currency account maintained by an authorised bank.
What if a resident Indian fall sick while travelling abroad? That is an important question. It is essential to buy a travel insurance plan if you are flying abroad.
What are the procedures an NRI is required to follow while buying a health insurance in India?
To apply for a health insurance policy in India, the applicant must complete the required formalities during the stay. The applicant needs to duly fill the form, submit all the relevant documents like copy of passport, copy of PAN card, details of the bank account in India etc. He or she much also furnish additional information that is asked by the health insurance company.
In case of any queries, the applicant must approach the health insurance company to clear the doubts. Following this, the he or she is required to make the payment for the policy. Most insurance companies only accept Indian currency for payments and not foreign currency.
NRI’s can avail tax benefits for buying a health insurance policy in India
As per the Income Tax Act, a policyholder can claim tax benefit under Section 80D for the premium paid for the health insurance policy. Like a Indian resident, any NRI who has bought a health insurance plan in India can also avail of this benefit .
Tax benefits remain the same. Medical insurance in India for NRI allows them to enjoy tax saving up to INR 50,000.
Disclaimer: The above information is indicative in nature. For more details on the risk factor, terms and conditions, please refer to the Sales Brochure and Policy Wordings carefully before concluding a sale.