# GIFT City insurance offers NRIs dollar option but higher cost 2026-08-24T09:58:10+00:00 | Business & Economy | Indian Opinion Desk Corroboration: 1 independent outlet Only 8 of India's 26 life insurers have branches in GIFT City, with most products focused on unit-linked insurance plans rather than term insurance. NRIs and foreign nationals can buy dollar-denominated policies from the financial hub, while resident Indians can access them through the Liberalised Remittance Scheme. Experts say the choice between a GIFT City policy and a domestic Indian plan depends on the currency of future liabilities. A dollar plan suits NRIs settled abroad with foreign-currency expenses, but premiums can be 50-60% higher on term plans and fund management charges on Ulips can reach 2-2.5%, against a 1.35% cap in India. Tax treatment differs: GIFT City Ulips get an uncapped Section 10(10D) exemption, while domestic Ulips with annual premiums above Rs 2.5 lakh face capital gains tax. For pure term insurance, death claims are tax-free in both cases. NRIs uncertain about returning to India may prefer a rupee plan due to the domestic market's maturity and pricing competition. ## Indian Opinion Analysis GIFT City's insurance market is in its infancy: only 8 of 26 life insurers operate there, and most avoid term plans. That limited competition keeps premiums high. For an NRI, the real trade-off is between currency risk and cost. The rupee has depreciated about 3% a year against the dollar for decades, so a rupee payout loses purchasing power over time. But a dollar policy's higher premiums and charges eat into returns. The decision hinges on a single unknown: where the policyholder will retire. If they return to India, a rupee-denominated claim avoids conversion losses and tax hassles. The next signal to watch is how many more insurers open GIFT City branches in 2025, which would indicate whether competition is lowering costs. ## Coverage - livemint.com Presents pros and cons of GIFT City insurance vs domestic plans with expert quotes, no editorial slant. This story was synthesised by AI from the source linked above. Tags: GIFT City, HDFC Life, NRI, Policybazaar, rupee, Tata AIA Life Insurance Canonical: https://indianopinion.org/gift-city-insurance-offers-nris-dollar-option-but-higher-cost/ License: Summary and commentary (c) Indian Opinion, reusable with attribution. Facts belong to the linked sources. Cite: https://indianopinion.org/gift-city-insurance-offers-nris-dollar-option-but-higher-cost/#story-in-brief How this brief was made: an AI model read the report linked above and wrote this summary and analysis, which were published automatically. Published briefs are sampled every hour by an automated quality check; the editor verifies its findings and approves corrections, and corrected briefs carry a dated correction line. We do no original reporting. Methodology: https://indianopinion.org/ai-use-policy/