During the British Raj, foreign insurance companies operating in India only wrote policies for foreign nationals because the risk profile of Indians was high. Fifty-five years after Independence, the perception has not changed.

If you are an Indian resident seeking to cover your life with a foreign insurance company, your application will be rejected.

An Indian working overseas cannot buy a life insurance policy in the country where he is working unless he is a permanent resident there.

Foreign nationals working in India, too, are subject to the same rule. Unless they have taken out an insurance policy prior to their posting in India, foreign nationals cannot buy a policy from an overseas insurance company because they do not accept applications from those residing in India.

However, an Indian resident of Hong Kong or Singapore continues to be an acceptable risk in the eyes of global insurance companies, despite these being struck by the SARS virus.

Reinsurers the world over have a list of countries from where they tend to decline life insurance policies.

Global insurers do not accept writing policies of residents of many Third World countries or where political unrest is rampant.

Political unrest, difficulty in investigating claims and a high probability of fake documents deter companies from writing risks in countries where they do not have their own operations.

Despite the entry of over 10 world-class global insurance players into India through joint ventures, these companies are adverse to taking exposure to any Indian resident choosing to take a non-resident policy.

According to senior insurance officials, the bad claims experience and easy availability of forged documents in India make underwriting the lives of Indians here a hazard most insurers dare not accept on their books.

Indian joint venture insurance companies on the advice of their respective reinsurers are only accepting life cover for NRIs living in North and South America, Europe, the  Middle East, South Africa and the Asia Pacific region.

During the Iraq war, there was a temporary ban on accepting life cover for those in the Middle East. Since then this ban has been lifted.

Global insurers are not willing to take exposure to residents of countries like China unless they have their own company based there.

"This is largely because of the political scene, and the fact that it is a closed country, making it difficult to investigate claims," senior officials of a leading private insurance joint venture said.

Recently, a few NRI applications were rejected by an Indian joint venture as the family was based in Thailand.

Here, the global reinsurer was not comfortable with the incidence of AIDS and the inability to investigate the claims when they arise.

An exception was, however, made in the case of one Indian family residing in Thailand, on the basis of their wealth.