For expats living and working away from their home country having a comprehensive medical insurance plan in place is not a luxury but a necessity. If an unexpected illness or accident should occur then expats without cover face a potentially dire situation and high healthcare costs, which can escalate very quickly, eating into any savings and possibly leaving debts too.
These days, expats have many choices when it comes to which medical insurance cover to purchase; international, local and even travel insurance. With so many other things to think about when moving overseas, the complexities of choosing the right plan that suits both individual and family health and wellbeing needs in unfamiliar locations, can be daunting. It's vital that expats think carefully through a number of factors and fully understand what they will and will not be covered for, and any geographical limitations their policy may have.
In this blog we'll examine International Private Medical Insurance (IPMI), Local Private Medical Insurance (PMI) and Travel Insurance, and the main differences between them.
International Private Medical Insurance
IPMI plans offer portability and flexibility for expats. Compared to a local medical insurance plan they may be a little more expensive, but in a competitive market there are good deals around. And the high benefit levels, extensive protection and peace of mind can often be worth the additional cost.
The majority of plans include worldwide medical protection (sometimes with USA cover as an optional extra) and many have evacuation and repatriation included as standard. IPMI plans will allow expats to take international business trips and move from country to country without losing continuity of cover. This is significantly different from local insurance, which makes this type of cover attractive to both individuals and company employees.
Most international insurance plans have direct settlement deals in place with hospitals, clinics and other medical providers so any bills will be paid directly by the insurer. Medical networks offer fast access to first-class treatment and care. If the care needed isn't offered locally the patient will be taken to the nearest centre of medical excellence – even if that's in a different country.
International private medical insurers will typically calculate premiums based on age, current medical history, and area of coverage, rather than on claims history. However, some benefits are limited - either by the amount of coverage provided for certain treatments or for a period of time, such as maternity or travel to specific countries or areas. Some IPMI policies will also cover treatment in an expats home country when they return – which can be a valuable additional benefit.
At first glance local medical plans look to be a good choice as they are usually cheaper than their international counter-parts. But before taking out a local medical insurance plan expats should look at the fine print and make sure it covers all of their requirements.
In many cases, locally purchased medical insurance is only valid for certain hospitals and clinics, which can vary in quality compared to a network operated by and international private medical insurer. This may not seem important for minor health ailments, but in the incidence of serious illness or emergencies, most people will want to be assured that they will receive the highest possible quality of care. Certain types of local plans may not provide this kind of cover and if they do most will place a ceiling on the maximum treatment costs at a far lower level than an international plan.
It is also risky to be without medical insurance, and some local plans have delays before they become valid because of lengthy administrative steps, form filling and having to wait for certain types of visa and work permits to be in place.
Finally, local insurance plans will probably not provide cover for trips outside the country of residence and expats will have no option to continue their cover if they return home – particularly important if they have a chronic illnesses.
Travel Insurance, whether for business or leisure is perfect for short-term trips and is essentially designed for emergency medical treatment and loss of personal items. The duration can be for a year (with a maximum number of days/trips away stated) or a number of days/weeks. Typically these policies are less expensive than medical insurance and are time specific.
The policy benefits limits are usually not as high as those with IPMI but if an accident or illness occurs, travel insurance will provide emergency treatment and care. Most travel insurances will also evacuate the insured to the nearest centre of medical excellence, or return them home for further treatment.
A comprehensive travel insurance policy will also include cover for loss of baggage, trip cancellation and curtailment, loss of money, loss of passport, flight delays and legal expenses.
With three types of cover to choose from – and plenty of different options within each category – selecting the right cover is tricky. IPMI can be a more expensive – although premiums can be reduced with the use of excesses and deductibles - but the protection is extensive. Local PMI is sometimes cheaper but usually comes with restrictions in terms of benefits and geography. And travel insurance is more targeted; covering loss of items and emergency medical cover.
Be sure to thoroughly research your choice – and ideally talk to an expert – and don't leave your health exposed.