Health Insurance plans for Non Resident Indians (NRIs)

“Homecoming” - the word has been romanticized over novels, poems & country songs too often. And none of them are exactly wrong. After all, something is heart-wrenching about returning to familiar aromas, scenery, food, and more.

However, here’s something no one talks about - whether one is in for a “prodigal son returns” scenario or not, he/she is at significant health risks when they return to their country after a long time. The once-familiar food, traffic, and weather conditions can push their body into overdrive. And subsequently, the chances of acquiring an ailment are heightened.

So, on the one hand, he/she is stuck with an illness that requires immediate medical attention or, worse: hospitalisation. On the other hand, he/she now has to worry about the financial dip because of the medical attention they require. After all, it’s not like his offshore health insurance plan would continue covering these costs!

And here comes the reason why health insurance plans for NRIs (Non-Resident Indians) are becoming a popular option among many. Take a look -

Why do NRIs seek health insurance in India?

Individuals worldwide have become increasingly aware of the financial catastrophe that prolonged medical conditions and their treatment can cause. This rising awareness can be attributed to the sudden onset & devastation caused by the COVID-19 pandemic. Due to this awareness, more and more people have gained coverage under health insurance plans.

However, certain niched nuances and cases of health insurance coverage are often left on the blind side. One of these is the international coverage that your plan covers. This aspect is of much value to those who are frequent flyers, those who have plans to settle in another country in the near future, and NRIs.

Here‘s a look at why NRIs have been looking to purchase a health insurance plan in India and are not just satisfied with their existing health insurance plans in their country of residence.

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Limitations on the international coverage feature/add-on

International coverage is an extremely niche-specific feature of health insurance policies. This health insurance add-on is crafted to offer coverage for policyholders when they are away on offshore trips. Now, this add-on serves the frequent flyers the best.

However, since they have been crafted for policyholders who travel frequently, there are certain restrictions on their coverage -

• Even the best international coverages from reputed health insurers come with a cap on the number of days for which the insurance lasts (at one go)
• The coverage offered often excludes the treatment of certain ailments and accidents caused due to certain adventure sports.
• Any complications arising out of your pre-existing ailments might not be covered.
• The premiums for the health insurance plan with international coverage riders might be steep.

So, international coverage might not be as reliable for those looking to stay in another country for an extended period.

No geographical restrictions

The best health insurance plans in India offer to fund policyholders, irrespective of where the claim is being raised (as long as it is within the boundaries of India). This suggests in case individuals travel from one corner of the country to another; they are still financially secured against any urgent medical emergencies.

Extensive health insurance coverage

Unlike the health insurance plans back home that have been availed with a health insurance add-on, the health insurance policies for NRIs in India have extensive coverage. So, as policyholders, you won’t be financially restricted from paying for your treatments, like in the case of the cappings under international coverage.

Tax benefits

If you have purchased a health insurance policy for either yourself, your spouse & kids, or your parents, you can make substantial tax benefits under the old regime of Section 80D.

[*provided you have a taxable income in India]

Lower premiums

Say you have been staying in the States for the past 5-6 years. Now, your employers assign you a project requiring you to stay in India for two years.  Think about this - dollars are more expensive than INR, and so are the healthcare charges. Naturally, the healthcare insurance premiums you purchased back in the States would be tough to maintain due to the premiums you must pay for the base plan and international coverage rider (which might not even be functional after a few months).

On the parallel end, since the cost of healthcare is relatively low in India, so are the premiums required to purchase and maintain a health insurance policy. Additionally, considering that you have proper guidance, you can enjoy the perks of premium plans that include -

• No room rent restrictions
• No copayment requirement
• No disease-wise sub-limits
• Low waiting period
• High No-Claim Bonus
• Extensive coverage
• Pre- and post-hospitalisation coverage
• Restoration benefits
• Daycare coverage
• Domiciliary treatment coverage
• Inexpensive super top-ups
• AYUSH treatment coverage
• Convenient claim settlement process

The pointers mentioned above are all true when you are seeking a financial security net for medical emergencies and have come to settle in the country for a few years. However, there is another probability - you, an NRI seeking health insurance plans for your parents, who are about to return to India.

Why do NRIs seek health insurance for their parents in India?

Avinash has been in the UK for the last 10 years. He had settled there with his spouse, kids, and his parents. Being a financially responsible adult, he had purchased health insurance plans that covered all his family members.

However, his parents are now getting restless about returning home (read: country). It is unclear whether it will be for 3 years or the rest of their lives. Avinash is worried since his ailing parents are well over their 60s and would need a financial fall-back plan in case they are hospitalised. How should he manage that? What should be his next plan?

Well, first of all, he should be planning to buy a health insurance plan for his parents back in India.

Secondly, the decision should ideally be taken 2 years before they return to India, while the health insurance policy of the UK still covers them. This time would ease the financial and medical vulnerability during the waiting period for pre-diagnosed ailments. During this waiting period, they will still be covered under the health insurance plan provided by the foreign country.

Here are a few reasons why one NRIs should prioritise the purchase of a health insurance plan for their parents -

• Health scares and their subsequent treatment costs

Even with all kinds of preventions and precautions, health scares for aging parents are always a matter of concern and fetches the requirement of financial security in case of any diagnosis of ailments.

Now, when it comes to returning to a completely different ambiance, climate, and food style, such health risks are an even major concern. Under such circumstances, you can’t really leave them and their life savings vulnerable in the face of medical emergencies. And international covearge is just not the answer because of their geographic restrictions, time limitations, disease-wise sub-limits, pre-existing disease exclusions, etc.

• Free Annual Health Checkups

Complete medical checkups are never pocket-friendly. And then there is the situation of you remembering all the checkups that they require. However, both these aspects are covered when you purchase a health insurance plan in India. Free annual medical checkups are a dominant perk in most plans - both in Individual Health Insurance Plans and in Health Insurance Plans for families.

• Relatively pocket-friendly

Unlike the health insurance plan you are continuing offshore, the premium for a mediclaim policy for your parents in India is comparatively cheaper since the healthcare service costs in India are lower. So, rather than shelling out more to extend the coverage for your parents in the UK along with international coverage (in case your parents are visiting for a few months)l, purchasing a mediclaim policy for your parents in India is a better financial decision.

• Alternative medicine treatment coverage:

If your parents find alternative treatment methods more reliable, a proper health insurance policy can also offer to fund the same. With the AYUSH treatment coverage, the policyholders are still financially covered, and their savings are safeguarded.

• Tax benefits

If one avail of a health insurance plan in India for his/her parents, the tax benefits under Section 80D  are substantial

[*provided you have a taxable income in India]

What are the disadvantages of Health Insurance for NRIs?

With health insurance for NRIs, timing is crucial. When the plan is purchased has a lot to do with whether you are looking at some lucrative financial backstop for medical emergencies or a financial pitfall. Here, take a look at a few of the disadvantages of health insurance for NRIs -

Senior citizen health insurance plans are pricey

When purchasing a health insurance plan for your senior citizen parents, do remember this - this plan’s premium might be cheaper as compared to their plan offshore. However, if you compare the premium a young individual pays against one that has to be paid for your senior citizen (or close to), the prices of the letter will be higher.

Health insurance providers look at senior citizen policyholders as high-risk clients because they are more susceptible to health complications and their consequent frequency of hospitalisation. This indicates higher chances of claim pay-out; thus, insurers demand high premiums.

Waiting periods can be a deal-breaker

If the health insurance policy for NRIs is not purchased a couple of years ahead before they shift to the country, the plan becomes almost useless. Here’s why -

Atul purchases a health insurance plan a month before he is shipped back to India. His work here will need him to stay for 2 years. What he didn’t figure out was that his health insurance policy has a 2-year waiting period on most of the ailment treatments. So, when he is done with the waiting period, he will return to his country of residence. So, his premium payment is completely in vain.

Pre-existing ailments can attract loading charges

Health insurance companies often add a charge to the premium in case of pre-existing ailments-loading charges. This makes the premiums even more pricey (and then there is the additional waiting period on pre-existing ailment treatments).

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What is the Best Health Insurance Plans for NRI in India?

For those individuals below 60 years

(Learn more about this from our blog on Best Health Insurance Plans in 2023)

For senior citizens

For families