Expat Essentials

Expat Essentials: International travel insurance can cover a multitude of disasters

Americans are equipped with certain built-in conditional responses. One of those is to the subject of “insurance.”

We recoil and shut our minds off, whether it’s being offered extra warranty insurance on the product we’re buying in the store or being buttonholed by a family uncle about our need for more life insurance. But, surprise! It really does pay to have international travel insurance when you go overseas.

travelinsurance_2241755bNot only can a good policy cover emergency medical treatment and assistance, but it can also cover:

  • trip cancellation and trip interruption;
  • loss of baggage;
  • legal liability arising from damage to a third party;
  • legal costs in case of involvement in a lawsuit;
  • the cost of reapplying for the loss of important travel documents (such as passport, tickets etc.);
  • hospital cash (a daily allowance to the traveler in case of hospitalization, either due to sickness or an accident);
  • repatriation of remains (the expenses incurred in moving an insured person to his/her country of residence);
  • and emergency financial assistance, should you lose all or a substantial part of your travel funds due to theft.

Of course, you don’t expect any of this to happen. That’s what insurance is, after all, a bet against something that you’d prefer not happen. None of us wants to die, but we still carry life insurance. None of us plans to get sick, but carrying health insurance is no longer a choice in the U.S.

Like all those other kinds of insurance, policies vary all over the lot.

Premiums differ, coverages and exclusions differ, even the reliability of the various carriers differs. There are several websites available to help cut through the clutter and confusion. One we found during our research is Squaremouth, a Florida-based site established in 2006 to provide information and to help put consumers together with insurance providers.

Other sites offering similar services include:

• Travel Insurance Review

Insure my Trip

Most of these sites are broken down into several categories, allowing you to learn the basics of travel insurance, compare carriers, compare rates, get the answers to frequently asked questions, get quotes and avoid certain traps.

Ah, yes, those traps, hidden in the fine print, the bane of every insurance policyholder. According to Rachael Taft, Squaremouth’s content manager, beware of a loophole in trip cancellation coverage. “Coverage is provided if your trip is canceled by things like someone getting sick or laid off, a hurricane or a terrorist incident – and there are more,” says Taft. “But the dirty little secret is that if the coverage is not specifically mentioned in the policy, it won’t be covered.”

Unless, she says, you buy the optional “cancel for any reason” rider available with many plans, which – not surprisingly – costs extra, but is comprehensive.

The much-reviled (by some) Obamacare has done away with exceptions for pre-existing conditions. Not so the travel insurance industry. Every insurance provider has its own medical team that will verify the non-pre-existence of your injury or illness – or not.

However, notes Taft, there is a waiver to the pre-existing condition exclusion that can be included with many plans. “Only buy a plan that offers a waiver to the pre-existing condition exclusion,” says Tyndal, “and then make sure you meet the requirements for it to apply.”

Furthermore, Taft warns, “you need to buy the insurance soon after your first trip payment; you need to be healthy when you buy insurance; and you need to insure the full amount of your trip.”

The equally reviled coverage exclusions can also be a trap. Every policy has ‘em, in a section usually entitled “General Policy Exclusions.” And they’re specific – for example: “You will not be covered for loss caused by ‘self-inflicted injury,’ ‘driving in a motor competition,’ ‘bungee cord jumping,’ ‘any criminal acts committed by you,’ ” etc. Pretty unambiguous and pretty easy to avoid – unless you simply can’t resist that bungee jump off the Millau Viaduct.

Fine-Print-QuoteOther exclusions to watch for include:

• Exclusions for incomplete documentation.

Claims are often delayed, even denied, because the insurer does not have the required paperwork from the insured, a doctor, a hospital, etc. In addition, warns Taft, if your claim is about a trip cancellation due to health reasons, the cancellation must be recommended by a doctor, in writing. In other words, not because you think your traveling companion is getting a cold that will ruin everyone’s trip.

• The “too late” exclusion.

If you’re already sick, it’s too late to buy insurance. If the hurricane is already named, too late to cover against it.

Also, says Taft, “certain coverage depends on your enrolling sooner rather than later. Not only will you have the longest period of coverage for cancellations, but you could also be eligible for benefits like a waiver for pre-existing conditions, ‘cancel for any reason’ coverage, hurricane coverage and more.

“The bottom line: If you’re going to buy travel insurance, buy it as soon as you make a trip payment.”

So what do you need?

According to Taft, you don’t necessarily have to pay more to get better coverage. In fact, she says, “we normally recommend the least-expensive, as long as it covers what you need.” For most travelers, that involves emergency medical care and trip cancellation coverage. “Those could be your big expenses,” says Taft.

For travel to Europe, she says, “we recommend that $50,000 in coverage is enough for emergencies, unforeseen medical expenses and other needs.”

Unfortunately, the health insurance you have at home may be far from enough if you get sick abroad. Your policy at home may limit the places you can go for treatment. In that respect, it’s no different than your PPO or HMO provisions at home. Also, Medicare policies are usually not accepted in the capitals of Europe.

Taft recommends calling your health insurance carrier at home to find out what is and isn’t covered overseas. At the least, international travel insurance could fill in the gaps of deductibles, co-pays and maximums. In any case, though, domestic health insurance policies won’t cover things like medical evacuation or ambulance services and certainly not health-related trip cancellations.

The Fine Print:

As for that sizable chunk of Dispatches readers, Americans living abroad are not covered by a travel insurance policy. The rule is that you must have coverage from your home country.

At some point in your travels, if you relocate residency to a European city you cease to be a “traveler” and your travel insurance policy will stop covering you. Some carriers will even refuse to cover you from the outset of your trip if they determine that your intention from the beginning was to relocate and reestablish your residency in Berlin, Amsterdam, London, etc.

Who does insure expats?  Squaremouth works with a list of the larger travel insurance providers and, other than John Hancock, you’ve probably not heard of any of them. These carriers tend to be specialists.

RoamRight, TinLeg and HTH Travel Insurance are the highest-rated.

Others include APRIL Travel Protection, Air Ambulance Card, AXA Assistance USA, InsureandGo USA, Seven Corners Inc., Travel Insured Intl. and MedJetAssist. There are 22 in all. And other sites list other carriers.

Now travel safe!

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