India insurance plans offer big savings for NRIs in UAE: What’s driving demand

Dubai: Non-resident Indians living in the UAE are increasingly turning to insurance plans from India — not only for lower premiums, but also for tax savings, long-term financial security, and the comfort of rupee-denominated protection for their families.

Industry data and insurer disclosures show a sharp rise in NRI demand for both health and life insurance products in India, driven by cost advantages and clearer eligibility rules under Indian tax law.

UAE, GCC buyers fuel surge

Digital platforms and insurers have been reporting recently that Indians in the Gulf now make up the largest segment of NRIs purchasing India-based life and health cover.

Some platforms show the UAE and GCC contributing close to 60% of India-linked term plan purchases in recent years. Most buyers are salaried professionals and business owners with ongoing commitments back home — dependents, home loans, elderly parents, and long-term financial plans.

A significant share of UAE-based buyers fall in the ₹25–35 lakh annual income bracket, choosing mid-to-high coverage values that offer meaningful protection at premiums far lower than international markets. Higher-income NRIs — those earning above ₹50 lakh — are also taking advantage of India’s favourable pricing and wider policy choice.

Health insurance demand rises

For many UAE-based NRIs, purchasing a health insurance plan for parents or dependents in India provides dual benefits: medical protection and tax deductions. Under Section 80D of the Indian Income Tax Act, premiums paid for health insurance of parents or family members in India qualify for tax deductions of up to ₹25,000 — and up to ₹50,000 if parents are senior citizens.

This has become a major driver of demand, helping NRIs reduce taxable income in India while ensuring relatives have cashless access to hospitals.

Lower premiums, longer coverage

India-based term insurance policies remain significantly more affordable than comparable international plans. Many UAE NRIs are choosing long tenures of 30–40 years, locking in rates that remain fixed even as they age. Monthly premiums are popular, though single-premium policies have gained traction among UAE buyers who prefer paying once for multi-decade coverage.

Policy values of ₹2–3 crore are the most common, balancing affordability with strong financial security for dependents. Additionally, women now represent a growing share of NRI policyholders, with meaningful uptake among UAE professionals. Improved financial independence and long-term planning habits are driving this shift.

Why UAE NRI demand keeps rising

• Rupee-denominated protection: Ideal for families, parents and assets in India.

• Lower cost compared to global markets: Term life premiums in India often cost a fraction of overseas plans.

• Tax savings: Health insurance premiums paid in India reduce taxable income for NRIs with India-linked earnings.

• Ease of digital onboarding: Video KYC, e-signatures and digital medicals simplify buying from abroad.

• Family-centric planning: Many NRIs prefer policies that directly support dependents living in India.

A recent Policybazaar statement noted that NRI demand for India-based term plans has doubled over two years, with Gulf-based Indians driving most of the growth.

The platform highlighted that buyers under 40 are increasingly opting for long-term cover and rupee payouts that align with family needs back home.

For UAE NRIs, the appeal is clear: India’s insurance products deliver value, protection and tax efficiency — all in a currency and regulatory environment familiar to their families.