Life Insurance Corporation (LIC) of India's Gulf expansion plans go hand in glove with LIC Housing Finance's (LIC Housing) plans to expand its non-resident Indians' (NRI) client base beyond Bahrain.
LIC Housing director and chief executive officer Kranti Sinha said: "Selling insurance along with housing is much easier than selling insurance alone." In effect, LIC's expansion will be on the wings of LIC Housing developing NRI products in the Gulf countries as LIC expands into Dubai and Oman.
LIC is LIC Housing's sole agent for sale of housing loan products to NRIs in Bahrain. Now as the incumbent insurer expands its foreign operations in the UAE, Dubai and Oman, LIC Housing is looking more keenly into developing housing loan products for NRIs in the Gulf region, the US and Canada, said Sinha.
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"We do not see much scope for expanding operations into the UK since there is little interest from NRIs there. In the US, on the other hand, with many having recently migrated there, there are Indians who are keen to set up homes in the native country either for themselves for a later day or for their parents," said Sinha.
Many Indians overseas want to construct houses in their homeland, and hence, opt for housing loans. Any existing or new policy issued under any acceptable plan of LIC can be used as collateral, covering the extent of the loan amount, in addition to mortgage of the house, Sinha said.
LIC Housing's 'Grah Shobha' scheme for NRIs offers loans of Rs 25,000 to Rs 5 lakh, but not exceeding 75 per cent of the total value of the property. As NRIs have contractual appointments in the Gulf countries, the maximum term of the loan is restricted to a period of 7-10 years.
LIC Housing does not propose to hike the cap for NRI housing loans considering that when they come back to India, they do not earn the same amount. "Hence it would not be prudent on our part to give higher loan amounts in the event of them defaulting on payment," said Sinha.
However, there is the green channel that offers professional Indians overseas a higher loan of up to Rs 10 lakh.