Study Abroad: Is it better to take insurance in India or at the location of foreign university?

Many universities ask the students to take insurance cover – especially health insurance – to ensure that they are not left untreated due to lack of money in case of serious illness.

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While opting for study loans, many lenders also ask students to take life insurance to ensure that the loan could be recovered even after the unfortunate demise of the student.

Many universities ask the students to take insurance cover – especially health insurance – to ensure that they are not left untreated due to lack of money in case of serious illness. While opting for study loans, many lenders also ask students to take life insurance to ensure that the loan could be recovered even after the unfortunate demise of the student.

“Many Indian lenders require students to purchase life insurance. This is so that if anything happens to the student, the lender can recoup their loan. However, foreign lenders like MPOWER fully discharge the loan in the unfortunate event of death or permanent disability; so, there is no requirement to get insurance,” said Ashwini Kumar, General Manager (India) and Vice President, MPOWER Financing.

In case a lender doesn’t ask for collateral or a cosigner, the family of a deceased student will never be liable for such a loan.

However, if needed, from where should a student take the insurance cover – from the home country or from the country of study?

“Students (and/or dependents) don’t always have a seamless experience for claims in a foreign territory. Its much easier to go with an insurance provider in the same geography as your place of residence, even if temporary, say 1-2 years during your education,” said Kumar.

“Students pursuing an overseas education are required to purchase health insurance, which covers the cost of doctor’s appointments and medical procedures. Your university will often make such insurance available to you, but health insurance can still cost $2500 to $3000 per year,” said Kumar.

However, the conditions many universities put in, make it necessary to take insurance cover from the home country.

For example, after getting admission in the University of Delhi, a student from Iraq approached an insurance agent to get health insurance cover as mandated by the University.

According to the rules and regulations mentioned in the University documents, the health insurance provider should pay the expenses for bringing in an ill student after preliminary treatment in India and also pay for the thorough treatment at the home country, if necessary.

As no Indian health insurer would provide the expenses for commuting from India to Iraq and hospitalisation expenses there, the student was asked to get the insurance from his home country only.

So, for Indian students desiring to travel abroad for higher studies, it’s better to get the insurance covers from Indian insurance providers, unless rules and regulations of a foreign university prevent it.

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