Canara HSBC Life Insurance has launched its Global Wealth Plan through Gujarat International Finance Tec-City (GIFT City), offering access to international investment options alongside life insurance protection. The US dollar-denominated unit-linked insurance plan (ULIP) is being distributed through Policybazaar and is aimed at non-resident Indians (NRIs) seeking investment and protection solutions.
The launch follows Ageas Federal Life Insurance’s introduction of its Aurum Advantage plan on October 8. While Ageas Federal’s plan allows investments in US dollars, euros and British pounds, Canara HSBC Life Insurance’s Global Wealth Plan focuses on US dollar-denominated investments.
How investment-linked life insurance works
Unit-linked insurance plans combine life insurance cover with investments in market-linked funds. A portion of the premium is allocated towards investments after applicable charges and deductions, while the policy provides life insurance benefits under its terms.
The value of the investment component depends on the performance of the selected funds. It can rise or fall with market movements, and returns are not guaranteed unless a specific benefit is expressly guaranteed under the policy.
Depending on the product, customers may be able to choose funds investing in international equities, fixed-income instruments and precious metals. These products combine investment exposure with life insurance, so customers need to consider the cost of cover, policy charges, premium commitments and withdrawal conditions alongside the available investment options.
What Canara HSBC Life’s Global Wealth Plan offers
Canara HSBC Life Insurance’s Global Wealth Plan is denominated in US dollars and provides access to global equities, precious metals such as gold and silver, and debt funds. The plan is being distributed through Policybazaar and is designed to combine market-linked investments with life insurance protection.
It has three variants: Wealth, Wealth Plus and Wealth Forever. Wealth is designed for long-term wealth creation, Wealth Plus includes a Premium Funding Benefit, and Wealth Forever offers whole-life cover for legacy planning and wealth transfer.
Under Wealth Plus, if the life assured dies, the sum assured is paid immediately and future premiums due are funded by the insurer, allowing the policy to continue until maturity, subject to the policy terms.
The insurer says the plan has no allocation charges or administration charges. It also offers Loyalty Additions and Maturity Boosters, depending on the selected variant. However, the absence of these two charges does not necessarily mean the policy is free of all charges.
Why foreign currency denomination matters
Foreign currency-denominated policies may appeal to customers who earn in foreign currencies or expect to meet future expenses overseas. For example, an NRI saving for a child’s education abroad may want to evaluate a policy denominated in the currency in which those expenses will arise.
However, investing in a foreign currency does not automatically mean higher returns or lower risk. The outcome depends on the performance of the underlying funds, the policy’s charges and benefits, and the currency in which the money will eventually be used.
Currency movements also matter. If a customer ultimately needs the money in Indian rupees, changes in the exchange rate can affect the rupee value of the proceeds. A policy denominated in a foreign currency may be more relevant to someone with future expenses in that currency than to someone whose financial commitments are primarily in rupees.
The choice of currency is only one consideration. Customers also need to compare the available funds, insurance cover, premium requirements and policy duration before deciding whether a product suits their needs.
What customers should check before investing
Customers considering these plans should assess both the investment component and the life insurance cover. The value of market-linked funds can fluctuate, so returns are not guaranteed. They should check the sum assured, death benefits and conditions attached to the life cover, along with all applicable charges that could affect the amount invested and the final fund value.
Withdrawal and surrender conditions also matter, particularly for customers who may need access to their money before the policy matures. They should understand the premium payment schedule and the consequences of missing premiums or discontinuing the policy. The currency denomination should also match their financial needs, as exchange-rate movements can affect the value of the proceeds when converted into another currency.
GIFT City provides a framework for international financial services, including insurance products designed for eligible domestic and overseas customers. Canara HSBC Life Insurance’s launch adds another foreign currency-denominated option to the range of investment-linked insurance products available through the financial centre.