Investment Plans for NRIs in UAE

An agreement between an insurance company and an insured individual, life insurance provides financial protection to the nominee(s) of the insurance in exchange for regular premiums paid by the policyholder.

NRIs can purchase life insurance in India, although they are residing temporarily in a foreign country. However, such purchases and disbursals related to life insurance are subject to the guidelines of the Foreign Exchange Management Act while also following other applicable IRDAI regulations.

• Term plans for NRIs

  A pure protection plan for NRIs, term insurance is the best form of life insurance, which requires them to pay premiums for a fixed policy term and avail life coverage for a specific duration. Such plans offer the death benefit to the nominee if the insured does not survive the policy term. NRI term plans typically provide add-ons such as critical illness cover and accidental death and disability cover for enhanced life coverages.

• Child Plans for NRI

  Through child plans, NRIs can secure the future of their children even after their demise. These life insurance plans are designed for parents to help meet the key life goals of their children such as higher studies while also offering add-ons like waiver of premiums to ensure that children do not have to pay future premiums.

• ULIPs for NRIs

  Unit Linked Insurance Plans (ULIPs) combine the benefits of life insurance and investment in a single policy. ULIPs for NRIs work exactly the way they work for Indian residents. Therefore, the policyholder’s dependents are entitled to the death benefit in case the policyholder dies during the policy term. In contrast, if the policyholder survives the policy term, they receive returns based on the ULIP’s performance.

• Retirement Plans for NRIs

  Insurance companies in India offer retirement plans for NRIs that provide them with a monthly income after retirement through purchase of annuities. These NRI plans are aimed at helping them plan their life post retirement, thus securing their future financially.

Fixed deposits (FDs) at banks are quite popular among Indian residents to earn interest way higher than what savings accounts offer. Since FDs offer fixed rates of interest and are decided by banks, they are a great NRI investment option today. NRIs holding an NRO, NRE, or FCNR account can start an FD at their discretion.

• Fixed deposit via NRO account

  NRO accounts allow NRIs to control their income in India, such as rental income or dividends from shares and mutual funds (if any) paid into their NRO account. If they can produce supporting documents, NRIs are allowed to remit up to $1 million from the NRO account.

• Fixed deposit via NRE account

  NRIs can open an NRE account in Indian currency, with an interest rate of 5% to 7% subject to the duration of the tenure. The interest earned on such an account is tax-free in India but may not be in your residing country.

• Fixed deposit via FCNR account

  Another option is opening an FCNR (or Foreign currency non-resident) account, with a tenure of up to 5 years, where the interest earned is tax-free. The best thing about this account is there is no impact on forex fluctuations on deposits.

NRIs in the age group 18 to 60 years are allowed to open an NPS account in with a point of presence (pop) in India. Those who have a valid PAN card and Aadhaar Card can even open an eNPS account. An existing NRE/NRO account can be used to make investments in an NPS account.

With this account, NRI investment in India can be a maximum of 75% in equities, irrespective of the options such as Equity, Corporate bonds, and Government securities. In such a case, it is best to opt for auto choice to allow asset allocation based on life stage(s).

NPS account allows withdrawals of up to 20% of the total corpus before the age of 60 years while the rest 80% gets annuitised. However, up to 40% of the total corpus can be withdrawn on reaching or after 60 years of age, while the rest 60% must be annuitised.

Note: The pension payable from the NPS account is in Indian Rupees only.

Real estate investments can be among the great investment plans for NRI in India over the last decade, especially property in major cities such as New Delhi, Mumbai, Bengaluru, Pune, and Gurugram. Several NRIs have purchased multiple properties in these cities and let them out on rent.

In India, real-estate investments are a great option, as the country is highly expected to see massive development in the coming decade or so, which can be risky too. However, they are not allowed to purchase agricultural land in India. Therefore, do consider all the option and analyse the associated risk beforehand.

Mutual funds (MFs) are great NRI investment options in India based on your investment objective and risk appetite. MFs offer much higher returns on investment compared to bank fixed deposits. However, you must have good knowledge of mutual funds as they are market-linked and involve high risk. To begin with MFs, there are several fund houses, but some asset management companies (AMCs) restrict NRIs based out of Canada and the United States.

NRIs are allowed to invest in MFs only through their NRO or NRE accounts in India. Moreover, the rate of returns earned from mutual funds is subject to the fund type (i.e. debt, equity, or hybrid) and investment horizon.

Axis Max Life Smart Fixed-return Digital (SFRD) plan is a life savings plan that addresses the investment needs of an individual. SFRD is aimed at making your life investments easy by preparing investors for their financial goals. It offers the dual benefit of guaranteed*# tax-free returns and life cover.

SFRD offers a guaranteed*# corpus at maturity in case the policyholder survives the policy term. The maturity benefit offered is the sum of the following:

• Sum assured on maturity
• Accrued guaranteed additions (only with Titanium variant)
• Additional maturity benefit (on paying higher premiums)
• Additional maturity benefit (for female customers)

Axis Max Life Smart Wealth Plan (SWP) is a life insurance savings plan that offers guaranteed*# returns to secures your future financially, thus allowing you to accomplish your life goals and fulfil your dreams.

NRIs can invest in Axis Max Life SWP to build a corpus for their retirement and even to secure financial freedom of their loved ones residing in India, in their absence. This investment is a suitable option for those who seek to invest in a financial instrument that offers long-term capital appreciation with considerably low risk.

Axis Max Life Online Savings Plan (OSP) is an online-only Non-participating, ULIP that offers a perfect combination of life insurance and investment for a secure future.

Axis Max Life OSP provides a lump sum payout immediately on the death of the life insured, followed by regular payouts in the form of family income benefit as well as the total fund value at the end of the Policy Term.

Additionally, the company shall pay all future outstanding premiums after the date of death of the life insured.