Which do you need – expat insurance or travel insurance – to cover your medical needs while you travel?
To help discern the differences and structure the right policy for your needs, I chatted with David Tompkins of Expat Financial (an international insurance brokerage that sources travel insurance, expat insurance (aka: international health insurance), and other insurance needs for people living abroad.
Who Needs Travel Insurance?
“Someone who is traveling for a year or less. Some travel insurance plans can cover you up to two years, but remember that travel insurance will only cover emergency claims and will not cover you back in your home country,” says Tompkins.
He also suggests that you maintain your health coverage back home (since most travel insurance policies don’t cover you in your home country).
Who Needs Expat Insurance?
“The perfect candidate for international health insurance [expat insurance] is someone who is traveling or living abroad for more than 12 months,” says Tompkins It’s a comprehensive medical insurance policy providing coverage around the world. “An international health insurance plan will provide both emergency and non-emergency care both abroad and possibly back home.”
Tips for Structuring Your Policy
Regardless of whether you choose travel or expat insurance, here are some tips:
Evacuation and Repatriation
Tompkins highly recommends “obtaining a plan that includes evacuation and repatriation care, especially if you are residing or traveling in a developing country with limited medical facilities.”
I can attest to this, having been mercy to the insides of a few hospitals in my own travels.
Most insurance policies exclude any coverage that is related to any pre-existing condition you have. If there are complications or related illnesses/injuries on the road, this could result in a pricey bill for you. Tompkins says a solution to this is to “try to obtain a policy that can underwrite you medically and potentially cover your medical condition for an extra fee.”
Pregnant, or Planning to Be?
Travel insurance plans won’t cover pregnancy related medical visits or illnesses, but “an international health plan [expat insurance] may cover pregnancy coverage after a waiting period of 12 months.”
Choose a Reputable Company
“Make sure you get a policy with a large and secure insurance company that will stand behind their coverage and be able to process your future claims,” suggests Tompkins. Look for a company with long history and a secure financial rating, read the policy and terms to ensure they cover things like direct reimbursement to hospitals, and search for online reviews to see how the customer experience is.
Use a Broker
I’ve attested to the virtues of using a broker before; they can source a policy that best meets your needs, they generally only work with reputable insurers, and they help you through the application process. I haven’t used Expat Financial, but I do see that they represent three insurance companies that I’ve had policies with before, so they seem to have their bases covered.
And don’t worry, you don’t pay a fee to use a broker; they are compensated by the insurance companies.
If you know expat insurance is the one for you, keep in mind the following:
Vision, Dental, and Extras
“Some expat health plans will also provide the option of obtaining dental and vision care,” says Tompkins. Some of these beefed-up plans also include some coverage for services like massage and physiotherapy.
But remember, the more plush the plan is, the higher your premiums will be. Need for, availability, and cost of these services depends on where you are traveling/living.
I tend to structure the most basic policy I can find to cover me in emergency or costly medical situations (with a high deductible to keep premiums low), and I take care of minor medical needs and doctors’ visits with cash (here’s a comparison of what I’ve paid to see a doctor in a few countries).
Most expat health insurance plans give you an option to include or exclude coverage if you are traveling/living in the USA. “Medical costs are quite high in the United States and many plans will provide you the option of excluding medical care in the USA, which helps reduce the premiums,” suggests Tompkins.
One of the expat insurance plans I owned excluded USA coverage; I justified it in knowing I could buy a small dedicated travel insurance policy covering any time I’d spend in the USA, and I would still save money off the yearly global plan.
(The policy I have now with IMG Global has really attractive global rates – including USA coverage).
What Happens to Your Premiums Over Time
Contrary to auto insurance (which rewards no claims with discounted premiums), expat insurance premiums will go up over time. Tompkins says “the average health inflation rate is 10-15% depending on the insurer. Most individual health plans [premiums] are not impacted by your own health claims, but are affected by the claims experience that the insurer is facing in any given year”.
I’ve written quite a bit about insurance. Dig in: