Canara HSBC Life Insurance has introduced a US dollar-denominated unit-linked insurance plan in GIFT City for non-resident Indians, distributed via Policybazaar. This product allows investments in global assets while avoiding rupee conversion risks. Investors should consider the volatility of global markets and the specific regulatory framework governing the International Financial Services Centre.
Canara HSBC Life Insurance has launched the Global Wealth Plan, a new insurance product designed for non-resident Indians (NRIs). The plan is specifically offered through the Gujarat International Finance Tec-City (GIFT City), India’s designated International Financial Services Centre (IFSC).
The key feature of this product is that it operates in US dollars. For NRIs, this removes the hurdle of currency conversion when investing in insurance products, allowing them to manage their assets in a globally recognized currency. By utilizing the framework of GIFT City, the insurer aims to simplify the process of investing in diversified financial assets, including global equities, precious metals like gold and silver, and debt instruments.
Canara HSBC Life Insurance is backed by a partnership between Canara Bank, which holds a 51% stake, HSBC Insurance (Asia-Pacific) Holdings with 26%, and Punjab National Bank with 23%. This ownership structure combines the reach of large Indian public sector banks with the global financial experience of the HSBC group. The insurer is utilizing its partnership with the digital platform Policybazaar to distribute this product to a wider base of NRI customers.
The product is structured into three tiers to cater to different financial goals. The Wealth tier is designed for long-term capital growth. The Wealth Plus option includes a feature called the Premium Funding Benefit, which helps ensure that premium payments continue if the policyholder passes away during the term. The third tier, Wealth Forever, is built for whole-life coverage, often used for multi-generational wealth transfer.
From an investor perspective, this product functions as a market-linked investment. Because the value of the policy is tied to global equities, gold, silver, and debt, the returns will fluctuate based on the performance of these markets. Investors should monitor the performance of these global asset classes, as market volatility directly impacts the policy value.
Additionally, operating within GIFT City means the product follows the regulatory guidelines set by the International Financial Services Centres Authority (IFSCA), which differ from those governing standard domestic insurance products in India. Investors should carefully review the specific product terms and the tax implications of investing through an offshore financial center. The long-term performance of these policies will depend on market conditions and the insurer's ability to manage these global asset portfolios effectively.