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Why NRIs Should Buy Insurance Policy from LIC of India

Jul 27, 2015

Ever since India got independent in 1947 it has evolved as a nation. Over the years, it has developed as a hub for foreign investments and offers great opportunities for growth of money.

Insurance is one such sector that offers limitless growth to investment. And with Life Insurance Corporation of India (LIC) being at the helm of insurance domain, safety and security of funds is guaranteed.

Listed below are some noted reasons why NRIs should buy an insurance policy from LIC:

Life Cover: By default a life insurance cover by LIC confers a life cover to the policyholder. Thus, it offers financial security to the entire family even after the sad, untimely and unfortunate demise of the policyholder.

Great Investment Module: Over the years LIC has evolved as a great investment module. Surprisingly, it is no longer a medium that only safeguards your family after your death. In fact, LIC offers some of the most versatile endowment plans that offer the dual benefits of saving and protection. In reality, LIC policies today take center stage and promise a great return that takes care of your financial responsibilities at varied stages of life with its guaranteed returns.

Tax Rebate: According to the Indian Income Tax laws, the premiums paid during the policy term can be claimed as an exemption from annual income.

Tax-Free Returns: Moving further, the returns from insurance policies are not taxable at maturity. This feature is especially important for NRIs as they usually fall under the 30% tax bracket. Tax-free returns thus act as a great and significant advantage leading to a manifold increase in the investment-return rate.

Guaranteed Returns: Unlike investments in equity and stock market, the returns offered by non-market linked LIC plans are guaranteed. Also, with pre-known maturity date NRIs can safely plan their years ahead.

Convenient Premium Payment Modes: NRIs who hold insurance policies in India can avail either of the two methods of premium payments. One, foreign currency-denominated policies have premiums paid in foreign currency through a NRE/FCNR account. Alternatively, for Indian currency-denominated policies premiums are paid in rupees using NRO account.

Easy Repatriation of Funds: An insurance policy taken in India covers death that occurs anywhere in the world. As the premiums and returns are paid and received in the same NRE/FCNR/NRO account, the repatriation of funds to country of residence is thus easy and hassle-free.

Great Way to Exhibit Nationalism: By virtue of being an NRI, you are dwelling and operating in different countries. Investing in an LIC policy in India offers perfect opportunity to nurture your 'Indian-at-heart' spirit and do your bit for your home country. The funds so invested in LIC are optimally utilized in the holistic development of the country, which indeed is a moment of pride for every Indian.