Life insurance is a very important tool for families, especially for non-U.S. citizens. In case you were to die, life insurance provides a lump sum payment, or death benefit, to your loved ones. This payment can help your family financially and can be used to pay for the daily expenses, paying off home mortgage, children's education or wedding. Life insurance provides you with the financial stability and peace of mind in case of unexpected death.
Not everyone that lives in the U.S. is a U.S. citizen. There are millions of people who legally live in the U.S. on various visas for various purposes. Non-U.S. citizens primarily fall into three categories:
- Permanent Residents: Also called green card holders. They are treated the same as the U.S. citizen for life insurance purposes.
- U.S. Residents: Even though they are not U.S. citizens, they live in the U.S. This includes various visa holders as well such work permit holder (EAD holder or Employment Authorization Document holder.)
- Non-U.S. Residents: They primarily live outside the U.S. Even if you are a U.S. citizen that primarily lives outside the U.S., you would come under this category.
There are fewer companies providing life insurance to non-U.S. residents compared to what is available for Permanent Residents and U.S. residents. For non-U.S. residents, to apply for life insurance in the U.S., there are several key factors to consider.
In order to be eligible for life insurance and to get a certain category of rates, there is multiple criteria that could be applied by various life insurance companies to determine rate class, such as:
- Substance Use (cigarettes/cigars/pipe, alcohol or drug use)
- Medical history, especially conditions such as diabetes, heart, overweight, and other medical conditions. Some insurance companies require that you must have visited a doctor within the last three years.
- Family health history
- Criminal and driving/traffic records
- Time of residency in the U.S. such as the amount of time in the U.S. and future plans. Some life insurance companies require that you have lived in the U.S. for a minimum duration, such as 6 months or 2 years. The longer that you have lived in the U.S., the easier it will be to obtain life insurance.
- Travel outside the U.S. and destinations
- Citizenship and immigration status (what visa type)
- Country of residence and the location of residence within the country, country of origin
- Assets (for high amount death benefit policies)
In addition to the criteria listed above, there are minimum requirements in order to apply for life insurance in the U.S. such as:
- Copy of the green card or the visa status including the copy of latest Form I-94
Some visa types such as A, C-3, I, S, T, U may be considered on a case by case basis. However, those of TPS or TWOV would not be eligible.
- Foreign residency questionnaire
- Foreign travel questionnaire
- Employment history
- Social Security Number
However, some companies will accept ITIN (Individual Tax Identification Number).
If that is not available, the applicants would need to complete Form W-8BEN - A certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting.
- State specific forms that confirms the residency in a state, depending where the applicant lives or applies from.
- Premium must be paid from a bank account in the U.S.
- Medical exam must be performed in the U.S. For some small amount policies, a medical exam may not be required.
The insurance company may need your medical records from your home country in most cases, it could be helpful if you brought them with you.
- Life insurance application forms must be signed while the applicant is in the U.S.
- Must be physically in the U.S. during the entire underwriting process which typically takes 8 to 12 weeks. The policy must be mailed to the U.S. address in the same state from which you applied.
Ties or a connection to the U.S.
If you plan to visit the U.S. just to buy the life insurance, that may not work.
- Verification of financial documents by a third party for death benefit of $1 million or more.
- You will not be eligible if you are currently active in foreign military, police, government or judicial services.
While some life insurance companies don't consider your citizenship status and just provide the rates based all other criteria as long as you live in the U.S. and plan to do so for the foreseeable future, other companies will only give you the standard rating, opposed to preferred, preferred plus or preferred best rating.
Country of Residence or Travel
While underwriting life insurance, many companies consider the country of residence or the country where you plan to travel within the next year or so.
Many companies assign a letter to each country and they may generally follow something like:
- "A" country - The countries that would qualify for the best rates available, such as preferred plus or preferred best, just like U.S. citizens.
- "B" country - Country that may qualify for rates up to non-smoker plus rates.
- "C" country - Country that may qualify for the highest rates, such as smoker rates, even if you don't smoke.
- "D" Country - Unacceptable country of residence or travel; ineligible for life insurance.
- Prohibited country - Regulations of some countries simply prohibit the sale of life insurance to their residents and therefore, they are ineligible to purchase life insurance in the U.S.
Sometimes, a country may have a different rating, but a city or region within the country may have a different rating.
E.g., China may be rated as "C" country but Beijing or Shanghai may be "B" rated. On the other hand, India may be rated "B" but the state of Jammu & Kashmir may be rated "C" or even "D".
The actual rating varies based primarily on the living standards of the location, such as healthcare, sanitation, availability of health care, the risk of living or visiting the location.
While H, L, R as well as F visa holders would be considered U.S. residents for life insurance purposes because they live in the U.S., there are many who would be considered non-U.S. residents such as B1/B2 (Business visa holder, Tourists etc.) because they don't live in the U.S.
For the purposes of underwriting life insurance, non-U.S. residents are generally defined as:
- Individuals that spend more than 3 months per year outside the U.S. This could be U.S. citizen or non-U.S. citizen.
- Individuals that visit the U.S. for business (B1) or pleasure (B2) but maintain the permanent residence outside the U.S. E.g., Indian citizen that is visiting tourist locations in the U.S., or a U.S. citizen that lives in Dubai but occasionally visits the U.S. to see family.
- Individuals that are expected to live in the U.S. on a temporary basis. E.g. A J visa holder that is in the U.S. for short term research project or training.
- Individuals that reside in the U.S. part time. E.g. A citizen of China owns a home in China and lives in the U.S. for 3 months a year for business purposes.
Of course, the exact definition varies from one company to another.
There are certain countries whose regulations simply don't allow their citizens to purchase life insurance outside their country residence. Most of those countries are Argentina, Belgium, France, Greece, Japan, Panama, Poland, Switzerland, Uruguay and Venezuela - This list is subject to change.
On the other hand, residents of certain countries would be ineligible to purchase life insurance from the U.S. due to U.S. government regulations or because the risk is too high in a given country to offer life insurance. Most of those countries are Afghanistan, Cambodia, Cuba, Haiti, Iran, Lebanon, Myanmar, North Korea and Sudan - This list is subject to change.
Generally, if you live in a country where the U.S. State Department has issued a travel warning, or a country is at war, or at the risk of political instability, terrorism or uprising, a country that is experiencing a famine, endemic, epidemic or pandemic disease or a country that has non-existent or limited medical care, you would not qualify to purchase life insurance from the U.S. Of course, such situations are subject to change periodically and the list varies for different life insurance companies based on their risk tolerance.
Ties to the U.S.
Most life insurance companies would expect you to have some ties or a connection to the U.S., such as:
- Employed by a U.S. company in the U.S.
- Payment of income taxes in the U.S.
- Ownership of business or property in the U.S.
- Bank account or investments in the U.S.
- Immediate family members, such as spouse, children, parents or siblings, live in the U.S.
- Minimum certain duration of physical presence in the U.S. per year such as 2 weeks, 1 month, or 3 months.
- Percentage of your assets in the U.S.
In general, if you have a good chance of residing in the U.S. indefinitely, such as when you are a student at the university or you are on work visa, many life insurance companies are willing to offer you insurance.
If you have no plans to visit the U.S., or you have no connection or qualifying relationship with the U.S., you may not be eligible to purchase life insurance from a U.S. based company.
While looking for life insurance for non-U.S. citizens, you should keep in mind some of the following points:
- Many companies provide life insurance for a minimum of $250,000. However, some may allow a lower amount.
- The maximum amount of life insurance primarily depends upon your assets, income, health and age. Amounts as high as $40 million or even higher may be available.
- Most companies insure people below the age of 70 years. Beyond that, it becomes more difficult to find life insurance, even for U.S. citizens.
- There are various types of life insurances available, such as term life insurance, whole life insurance, and universal life insurance.
Even though purchasing life insurance for non-U.S. citizens requires more research and paperwork, there are many options available. With Insubuy, Inc., you can get Instant Quotes from multiple companies and apply within minutes.