What are my life insurance options when living abroad?

As an expat, there are several reasons why you may be looking for life insurance.

It could be that your previous policy has come to the end of its term.

Or it may be that you have found out that your old policy does not cover you now that you are living overseas. You may have had a “life event”, e.g. marriage or birth of a child.

Or you may be looking to use it as a way to mitigate an inheritance tax liability.

Whatever the reason, you need to know the options open to you.

Option 1 – Look for a provider in your home country

Most insurance providers in the UK are not going to let you set up a new policy with them if you are no longer resident there.

In the unlikely event that they do, cover will depend on the country that you are now resident in.

I.e. if you are living in Switzerland, you may be ok.

If you are living in Sri Lanka, for example, they are less likely to cover you.

Additionally, if you subsequently move from safe country A to not–so–safe country B, then you are back to square one.

However, in that case, you are now older, meaning that the cost of cover is going to be greater.

There is also the risk that in the meantime your health has deteriorated and you may not be able to get cover at all.

Option 2 – Look for a provider locally

There are a couple of reasons why this isn’t the best course of action for you.

Firstly, it’s not uncommon for local insurers to have restrictions on foreigners buying life insurance.

For example, the amount of coverage that you can have may be limited.

This could leave you underinsured and your family exposed.

The other factor is that if you move to an assignment in another country, you will be back where you started.

I.e. your cover will no longer be valid and you will be looking at setting up another life insurance policy.

Option 3 – Set up an international life insurance policy that is designed for expats

This is likely to be your best option.

It is what I did when I found out that the policy that I had set up when I was living in the UK no longer covered me once I moved overseas.

With an international policy, the insurer will cover you wherever you live and the insurance will also be valid should you move on to live in another country.

This eliminates the need for you to chop and change policies and as a result you are not exposed to the risk of your health deteriorating and suddenly finding out that you are unable to get cover at all.