Do expats in China need life insurance?

Life insurance is sometimes the elephant in the room. We don’t like to talk about it but it’s massively important. Not just for us, but essentially for our dependents. Are you an expat currently living in China? If so, it’s imperative that you seriously consider your China Expat life insurance needs today. 

Living or working abroad can be a life-changing experience. It can be exciting, exhilarating, educational, and frightening all at the same time. Although it’s very liberating to cast off the shackles of the Western World, we still need to exert common sense, especially where life insurance coverage is concerned. 

Has the recent COVID pandemic made you look at life differently? Are you now thinking about your China expat life insurance options just in case? Here is a guide to life insurance in China for expats and why you need to cover yourself and your family against any and every eventuality.

Do you need China expat life insurance?

It’s not a very difficult question to answer. Yes! Everyone needs life insurance because who knows what can happen in this crazy world of ours. Here are the types of people that seriously need to consider their expat life insurance options in China today.

Expats with families

 If you are an expat living in China and you have a young family with kids, you urgently need coverage. Not tomorrow, not next month. But today! It’s your responsibility to ensure your family is protected. Illnesses and accidents can happen at any time. Without sounding too dramatic, who knows what is lurking around the corner. Married expats with kids also need to think about the future of their children. There are potential college fees, taking the first steps on the property ladder and all manner of issues to think about. If you are in this demographic, you need to seriously consider your expat life insurance options sooner rather than later. Securing your children’s future should be the first thing on your list.

Expats planning for retirement

As we get older, we are more susceptible to illness and disease. If you are a mature expat living in China and you don’t already have life insurance, you are literally playing Russian roulette. Get covered now, because it might be too late if you are already ill.

Expats with financially dependant parents

If you already have older parents or family members that rely on you financially, expat life insurance is also a must. You do not want to leave your parents in trouble if something happens to you. Make sure your dependents are protected against any eventuality. Having a sound peace of mind is a cornerstone of happiness. Especially where the future and well-being of your loved ones are concerned. 

Types of expat life insurance available to you

The life insurance industry can seem like a potential minefield to some. This is why you need to know your options and the types of China expat life insurance that is available to you. The basic definition of life insurance is a financial compensation policy that provides coverage in the event of a death caused by an accident or a medical issue. Your family will receive a lump sum of cash depending on the type of insurance coverage you have.

Here are some types of China expat life insurance policies that you need to know about.

Annual renewable life insurance

If you are only planning to live in China for a relatively short amount of time, this is the ideal insurance plan for you. If you are only going to be away from your home country for 5 years or so, the annual renewable life insurance plan is perfect. These shorter term contracts are ideal for younger expats living in China for just a few years. The contract can be renewed every year. And although it is slightly more expensive than a life insurance plan that potentially runs for decades, it’s a viable option for younger people whose premiums would be lower anyway.

Long-term life insurance plans

Are you an expat who is planning to live in China for the long haul? If so, you could save massive amounts of money and trouble by utilizing long-term China expat life insurance plans. Here is the best part. If you get long-term life insurance coverage over a period of 10 years or even 25 years, the costs remain fixed and do not rise, even over the course of decades.

This option covers decades until you are approximately 65 years old when you might have to change your plan. By this time, your kids might already be grown up adults. It is also important to remember that the payout upon death to your family members will also not increase over the years to reflect inflation. However, it is possible to top-up your plan at a later date to counter-balance inflation. The younger you are when you secure your long-term insurance plan, the cheaper your premiums.

Lifetime China expat insurance plan

If you want long-term life insurance coverage that matures at with time and upon death, the Lifetime China Expat Insurance plan is your ideal choice. This is the next logical step forward from a long-term plan. These types of lifetime plans can mature right up to the age of 120 years old. Although the premiums are much higher than a long-term plan, a decent payout that rises with inflation is guaranteed. This is the ultimate Chinese expat insurance option for those planning for a lifetime.

It’s important you have the knowledge to make the right decisions in regards to your expat life insurance plans. Here are some other things you need to know that could save you a fortune over the course of a lifetime.

Are China expat insurance plans tax-free?

It’s usually hard to cheat the taxman. Even after death! Especially after death! The taxman’s ungodly reach and scope knows no bounds. However, the great news is that the vast majority of life insurance plans are tax free. With inheritance taxes and other taxes that are designed to part you from your cash even after death, a life insurance plan is a great way to pass on an inheritance. Do you want your dependents to get everything that is coming to them in regards to inheritance? This is another reason why you need life insurance today.

Smokers and people with pre-existing medical conditions

It’s also important to remember that life insurance premiums are higher for smokers and those with pre-existing medical conditions. It will basically cost you more if you are a smoker or have other ongoing medical problems. Please bear this in mind.

Can I get mainland China life insurance?

Generally speaking, insurance plans that are licensed in China are not really ideal for expats. There can be many issues with these types of life insurance options. They are not focused on expats living in China as a general rule. They cannot pay out to an overseas bank account and have below average payout sums. It is important to check the wording with these type of Mainland China life insurance policies. But mostly, the written policies are in Chinese and are not really dedicated to foreign expats living in China. Be careful with these types of insurers. It’s a recipe for disaster. 

If you are an expat living and working in China, it’s imperative that you consider your life insurance options today. Especially if you are married, have a family, or have older parents that depend on you. Nobody wants to discuss the freak things that can happen in life, but it’s essential that we are mature about our responsibilities. Our China expat life insurance recommendations and options can help you to live a wholesome and stress-free life where your loved ones are protected against every eventuality. Be safe and prosperous!