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Health Insurance for Foreigners Residing in India

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Liberalization of the Indian economy has made it an attractive investment destination. However, inflow of foreign resources is not restricted to investments alone. A large number of foreigners are shifting to India for employment related reasons as well. Hence, the influx of foreigners shifting to India on a long Term basis leads to an obvious question- Can foreigners buy Health Insurance policies or life insurance cover in India?

A foreigner is free to buy Mediclaim or any other health insurance Policy in India without any restrictions. Foreigners can buy any and every type of insurance policy in India except for life insurance coverage. Life insurance companies are offering customized policies for foreigner. Citizenship of the individual is not a relevant factor as far as any other insurance cover is concerned.

Despite this general norm, a foreigner residing in India who is desirous of buying health insurance should go through the specific eligibility norms of the health insurance policy in question before finalizing the purchase.

A foreigner will be required to fulfill the following norms or requirements to become eligible to buy insurance cover in India.

Valid Visa & Permit to Enter and Stay in India

A foreigner staying in India for employment must hold a valid work permit. A foreigner staying in India to learn more about its culture and heritage must hold a long term tourist visa. Completion of visa and other formalities is a must to become eligible to buy a health insurance policy or a Travel Insurance policy in India.

Mediclaim Coverage Restricted To India

Buying mediclaim for foreigners in India will provide protection within India alone. The individual cannot file claims on the health insurance policy for treatment obtained in the home country. A travel insurance policy may prove useful during trips to the home country but mediclaim for foreigners in India will work only within India.

Tax Benefits Available For Foreigners As Well

Premium paid for health insurance policies can be deducted from the taxable income earned during the financial year under Section 80D. This deduction is available to foreigners as well. Income earned in India is taxable in India irrespective of whether the person is an Indian citizen or a foreigner. The foreigner can also rely on Double Taxation Avoidance Agreements to enjoy benefits of this deduction to reduce overall tax liability.

Waiting Period Applies To Foreigners As Well

Health insurance providers impose a 30 day Waiting Period during which claims cannot be filed under the insurance policy. This is done to ensure people do not obtain health insurance policies after being diagnosed with medical problems to transfer cost of treatment to the insurer. This waiting period will apply to foreigners as well.

Other Important Points to Remember

Traditional mediclaim policies do not cover critical illnesses. These illnesses can be covered by adding a rider to the policy and paying separately for the same. This norm applies to foreigners as well.

New age policies like Family floater plans and Health insurance cum investment plans are also available for foreigners. The Premium charged on these policies will depend on the medical condition of the individuals being Insured and the amount of coverage sought. The nationality of the individual does not affect the cost of the policy.

Paying in foreign currencies is best avoided. The individual will have to ensure laws and rules related to foreign exchange transactions are complied with. Further, exchange rate fluctuations may make it difficult to determine the exact amount payable until the amount is paid.