Most NRIs hold life cover in two countries without ever seeing the total. There is the endowment or money-back plan bought from LIC or a private insurer before leaving India, often still paid by standing instruction from an NRO account. Then there is the cover taken out abroad: decreasing term cover required with a mortgage, a multiple of salary through an employer, cover inside a pension or super fund. Each sits in a different currency, ends on a different date and pays a different person.
The result is that few households can answer a simple question: if one of us died this year, how much would arrive, and where? This calculator answers it on the policies you enter. It converts every policy into one currency, shows how the total falls as terms end and mortgage cover shrinks, lists the premiums and the maturity and money-back payments due in the next year, and sets the cover against figures you type yourself.
What an Indian policy does once you live abroad
An Indian policy usually stays in force when you move, but the paperwork around it changes. Insurers expect to be told of a change of residence, with an overseas address and a FATCA self-certification, and a claim from abroad is slower when the records are out of date. Premiums can usually be paid from an NRE or NRO account, and payouts usually go to an NRO account. Our life insurance guide explains why an old Indian plan rarely matches debts and living costs in another currency.
The tax treatment depends on where you live. A UK resident is usually taxed on the gain when a foreign endowment matures, and a US resident usually reports a policy with a cash value on the FBAR, which the FBAR and FATCA checker works through. Each policy in the calculator lists the points that usually apply to it for the country you live in.
Cover that pays a lender, and cover with no named recipient
Cover arranged with a mortgage is often assigned to the lender, so the payout clears the loan before anything reaches your family. That is often what was intended, but it means the headline sum is not money your family can spend. Check the remaining loan against the cover with the home loan EMI calculator.
A policy with no nominee or beneficiary usually pays into the estate, and an estate spread across two countries can take many months to settle. In the UK, a policy written in trust is usually kept out of the estate for inheritance tax; our guide to life insurance in trust explains how. Keep nominations consistent with your wills in both countries.
Reading the gap check
The gap check is arithmetic on your own numbers: debts left, years of income, goals such as school fees or a parent’s care, less savings that could be used. It does not say how much cover anyone ought to hold, and it does not take account of state benefits, pensions paid to a widow or widower, or tax on the estate, which vary by country. For a recommendation, speak to an adviser regulated where you live.
