Indian Expats' Terms of Life Insurance Purchases Doubled over the Last Two Years, According to Study Findings
In the past four financial years, there has been a significant increase in Non-Resident Indian (NRI) term insurance purchases from India. Despite initial search results not providing a direct link to the factors contributing to this trend, a closer look reveals several key factors that have collectively driven this surge.
One of the primary reasons for this increase is the growing awareness among NRIs about the importance of financial security and the need for insurance coverage for their dependents in India. This heightened consciousness, coupled with rising healthcare costs and financial uncertainties during and after the COVID-19 pandemic, has prompted many NRIs to secure term insurance.
Another significant factor is the growth in disposable incomes and investment awareness within the NRI community. As their financial standing improves, NRIs are increasingly seeking out insurance products that offer attractive premium rates and coverage options tailored specifically for their needs.
The simplification of purchase processes by insurers, including the development of digital platforms and easier documentation for NRIs, has also played a crucial role. This streamlined approach has made it easier for NRIs to access and purchase insurance policies, contributing to the surge in term insurance purchases.
Regulatory support and relaxation in cross-border financial transactions have also enabled easier premium payment and claim settlements, further encouraging NRIs to invest in term insurance.
Increased marketing and outreach efforts by Indian insurers targeting NRI populations have also been instrumental in this growth.
Most of these buyers are salaried professionals and business owners in sectors like construction, retail, and services. Women represent a growing segment among NRI term insurance buyers, with a current participation rate of 15%.
The analysis highlights that India's insurance sector is becoming increasingly attractive for NRIs. Many NRIs continue to have financial commitments in India, such as dependents, home loans, and investments, making India-linked insurance a preferred choice.
Key factors driving the increase in NRI term insurance purchases include competitive premiums, long-term policy options, and rupee-denominated benefits. Higher uptake of NRI term insurance is observed from the UAE and North America, with tech professionals and long-term permanent residents being a significant growth driver for NRI term insurance purchases, choosing India-based protection plans.
The UAE and Gulf Cooperation Council (GCC) region account for nearly six in every ten NRI term insurance purchases, contributing 59% of total NRI term life insurance policies issued over the past four financial years. Europe and Australia-New Zealand have also seen rapid adoption of India-linked term life insurance, recording a combined compound annual growth rate (CAGR) of 87% between FY22 and FY26 year-to-date.
Approximately 80% of NRI buyers prefer monthly premium payment structures for their term insurance policies.
As the NRI community continues to grow and financial awareness increases, it is expected that the demand for term insurance products from India will continue to rise. The Indian Finance Minister, Nirmala Sitharaman, has suggested that raising the Foreign Direct Investment (FDI) limit for insurers to 100% could generate employment opportunities, further boosting the insurance sector's attractiveness for NRIs.
Across the globe, NRIs are increasingly turning to India's term insurance products to secure their families and financial commitments back home.
- The growth in disposable incomes and investment awareness among NRIs has led them to seek out insurance policies with competitive premium rates and coverage options.
- The simplification of purchase processes by insurers, including digital platforms and easier documentation, has contributed to the surge in term insurance purchases from NRIs.
- Regulatory support and relaxation in cross-border financial transactions have made it easier for NRIs to pay premiums and settle claims, encouraging more investments in term insurance.
- Indian insurers have stepped up their marketing efforts, targeting NRI populations, particularly those in sectors like construction, retail, and services, contributing to the growth in term insurance purchases.
- Women represent a growing segment of NRI term insurance buyers, with a current participation rate of 15%.
- Across the globe, NRIs are increasingly turning to India's term insurance products to secure their families and financial commitments back home.
