8 reasons why NRI should buy Term Insurance in UAE

Until a few years back, many NRI had short-term plans for living and working in the UAE. But now things are changing, and people have started thinking long-term.

A majority of NRI are considering living longer or even retiring in the UAE, given the peerless infrastructure, tax-free income, and great standard of living.

Along with various other improvements, Life Insurance products in the UAE have become very attractive. They offer a wide scope of coverage at affordable premiums. 

Here are the eight reasons NRI should consider buying life insurance in UAE.

1. Critical illness Benefits Rider

Along with life insurance, you can add the critical illness benefit to enhance the scope of term insurance. Some companies cover up to 36 critical illnesses and would pay a claim on the diagnosis of such critical illnesses.

Critical illness cover's scope, definition, and limitations are well defined, and the claim process is seamless. 

In UAE,  companies like Zurich International Life,  MetLife, Salama, Oman Insurance, Orient, and Friends Provident International, offer the best term insurance plans for NRi and other ex-pats.

Each company has an exhaustive list of critical illnesses covered with well-written benefits definitions, scope, and limitations, eliminating ambiguities at the time of applying for coverage and at the time of claims.

2. Critical Illness Cover up to age 80:

How would you feel if someone snatched your umbrella just when it was about to rain?

Life Insurance companies in many countries offer critical illness benefits only up to the age of 60-65. 

While there are risks of developing critical illness at any age, the chances of getting critically ill are higher as the person ages.

Not having this benefit beyond age 60 could put your retirement savings at risk.

Given the increasing life expectancy, people are having to work even after age 60, and this benefit can protect against loss of income in such events. 

Insurance companies like Zurich International Life offer critical illness coverage up to age 80, with a wide scope of coverage.

3. Critical illness covers up to $2,000,000

Many insurance providers in UAE offer critical illness coverage up to $2,000,000. 

Having at least 3 to 5 years of income as critical illness cover is recommended. If your income is more than $30,000 per annum, then you should seriously consider buying life insurance in UAE with critical illness coverage. 

4. Transparent and comprehensive underwriting

Thanks to vast experience in covering critical illness, insurance providers in UAE have developed thorough underwriting systems. Hence they ask the right questions and conduct necessary tests before accepting the risk. 

This comprehensive underwriting activity eliminates the possibility of delays in claims; hence the providers in UAE have good claims settlement records on critical illness and life insurance claims.

On the other hand, companies in other countries have recently started offering critical illness plans.  Hence the precedence of claims is hardly there, making it difficult to understand the claim process of such policies.

Events like Covid-19 and lockdowns can make claims processing more challenging.

5. Ease of Claims

Insurance companies in UAE have acquired vast experience gained by operating in many countries, and they have developed a robust system of underwriting, claim processing, and settling.

Companies like Zurich, MetLife, Friends Provident Oman Insurance, LIC international, and Salama provide well-developed customer support via their call center and their offices across UAE.

6. Internationally Portable and Tax effective plans

Term Insurance Plans in UAE are portable internationally. They continue to cover the insured during their travel and after a change in residency for all the benefits availed as a resident in UAE.

Continuity of protection when changing residence from one country to another is an essential and helpful feature of term plans in the UAE.

Otherwise, the insurance cost would go up every time the insured has to buy a new policy when moving to another country, as the insured would be older than before, and the risk of non-insurability increases.

7. US Dollar-Denominated Plans

All insurance providers offer Term Insurance plans in US Dollar denomination, which is an ideal risk against a falling rupee. The rupee value has continuously been depreciating for the last 40 years and more rapidly in the previous few years.

India's rapidly growing population must be fed, clothed, entertained, and treated for medical ailments. India has to rely on imports mainly for crude, coal, cooking oil technology, medicines, defense equipment, and much more...

The steadily increasing demand for imported goods and services will create more demand for the US dollar, a medium of exchange for international transactions, further depreciating the Indian rupee.

The following chart shows the extent of rupee depreciation in the last ten years, highlighting the adverse impact on your rupee-denominated insurance or investment plans.

8. Easy access to Insurance Proceeds

Term insurance plans in UAE are portable. You or your family can claim to receive the benefits from any part of the world, making it easier to pay for money requirements outside India like;

• Paying off loans and mortgages if you have any in or outside UAE
• To enable your family to continue living as expats in UAE or any other country. This allows the children to complete their education up to a certain age
• Paying for higher education costs of your children for studies outside of India
• Enabling you and your family to continue to live in UAE in the event of diagnosis of a major illness, without worrying about paying bills like rent/mortgage, school fees, medical costs, etc.,

On the other hand, access to funds outside India from insurance proceeds of plans in India can be very challenging. You may have to go through elaborate approval processes, currency risks, charges, and tax implications.

Summary

When looking to avail of a term insurance plan in UAE, as an NRI, you should consider the 8 points mentioned above.

What about you?

Have you covered adequately for loss of income due to death, disability, or, most importantly, critical illness?

If not, what is stopping you?

Schedule a free consultation to discuss your protection needs and avail professional help in choosing the most suitable Life & Critical Illness Insurance.

Click here to arrange a Free Consultation.