This article is brought to us by Cooper, Claridge-Ware, an independent International Health Insurance Brokerage headquartered in Hong Kong, China with more than 55 years of experience in helping expatriates and travellers around the world find the best insurance solutions possible.
In our last two articles we explored the Travel Insurance and Local Health Insurance options which can be used to protect travelers against the costs of healthcare while traveling outside of their home country. If readers haven’t yet read about these options, they should probably do so now because this month we’re going to be looking at the best option for health insurance protection around the world – international private medical insurance plans.
In our local health insurance example we showed how a case may develop where medical insurance protection that is slightly more robust than simple travel insurance coverage would be required. Along those same lines, a situation may develop where local health insurance plans are not able to offer a traveler the protection they need, and travel insurance coverage just isn’t a good fit. International Private Medical Insurance plans, also known as International Health Insurance or simply IPMI, are one of the best options for medical insurance protection for travelers planning on being outside of their home country for periods longer than a year.
But what are the differences between local and international health Insurance plans and why choose an international policy over a domestic one?
Obtaining International Health Insurance
The first thing travelers need to know in relation to international health insurance is how to go about obtaining this type of coverage.
Generally, in order to purchase an international health insurance plan individuals will need to be living in a country which is not their home nation. While the individual may not have permanently relocated to another country and might not consider themselves to be typical “expatriates,” they will need a mailing address that is outside the country of their citizenship.
This means that, just as with our local health insurance example last month, in order to obtain an international health insurance policy an individual will need to have made the decision to live outside of their country of citizenship, and will need to have a mailing address outside of their home nation. Aside from this, however, there are normally no restrictions on the availability of international health insurance policies – these plans are typically available to all nationalities and ages as long as the individual requesting coverage is not resident in their country of citizenship.
Areas of Coverage
Once one has identified that they are able to obtain an international health insurance policy, the next thing they’ll want to consider is the plan’s coverage area. Unlike local health insurance plans, an international policy can provide truly global protection across many countries and regions. However, having said this, a majority of international insurance companies will actually let clients choose the plan’s area of coverage when they initially apply for the protection.
Common options for geographical coverage areas under an international health insurance policy include: worldwide coverage, worldwide coverage excluding the USA or North America and regional protection – such as Asia-Only or Europe-Only.
Now, having mentioned above that international health insurance policies can provide worldwide coverage, there may be some confusion as to why there are different options available with regards to restricting the geographical coverage area of policies; obviously the biggest benefit of this type of health insurance product is in the fact that a single plan offers protection around the world!
The answer to why separate coverage areas exist is actually extremely simple – healthcare costs.
Certain parts of the world will have average healthcare costs that are much higher than others; the USA, for example, has the highest average cost of healthcare on earth. As such, a policy which provides coverage in the USA will be much more expensive than one which does not. By enabling customers to choose exactly where they would like to receive insurance protection under the plan, an international health insurance policy ensures that travelers will be able to use the policy fully in the region they are traveling in, and helps to cut down on the overall cost of the coverage by excluding high-cost countries that will not be visited.
However, unlike local health insurance options, even if one were to choose a regionally-specific international health insurance policy they will still be able to receive coverage in more than one country. Obtaining an Asia-Only health insurance policy from a company like A+ International Insurance, for example, would still enable travelers to receive high quality healthcare treatment in Cambodia, Laos, Indonesia, Malaysia, Myanmar, Thailand, and Indonesia – giving assurance that one will always have access to the best hospitals and doctors in the country.
Freedom of Choice for Healthcare
Speaking of doctors and hospitals, this is another area where there is a divergence between international and local health insurance plans. Remember, local health insurance policies will often have preferred networks which patients must use when receiving medical treatment; forcing some to seek treatment with a specific doctor or hospital, even if they are not the best, in order to have that treatment covered under the policy.
International health insurance plans, on the other hand, allow policyholders to receive medical treatments from the doctor or hospital of their choice, as long as they are located within your plan’s geographical coverage area. This means that if someone has purchased an international health insurance plan that provides worldwide coverage, they are able to receive medical treatment with their preferred doctor anywhere in the world!
For example, if the plan provides worldwide coverage and the policyholder was diagnosed with a serious medical condition whilst spending a year in Thailand, they would not have to use a Thai Hospital for their medical treatment. While Thailand offers some very high quality medical facilities, such as the Bumrungrad Hospital in Bangkok, one could instead travel to the USA and seek treatment at the Mayo Clinic or Cedar Sinai and still have the healthcare covered under the international medical insurance plan.
Portability and Renewability
We’ve been looking at insurance options on a short term basis of up to two years with which to protect against the costs of healthcare while traveling. But at some point the traveler is going to want to return home and in many cases this would mean giving up their health insurance policy and suffering though the dreaded spectre of pre-existing conditions (if any have developed) upon returning to their country of citizenship.
The good news is that a number of international health insurance options are fully portable worldwide, even back to the USA. This means that, unlike local health insurance plans which will stay in the country where they were purchased, an international policy can travel wherever the policyholder goes – even if they return to their home nation. Because of this, pre-existing medical conditions – that is to say, medical conditions that have been diagnosed before one purchased their insurance – are less of a worry travelers are able to continue on the same plan no matter where they travel, ensuring that they continue receiving vital healthcare protection.
However, as we mentioned last month, local health insurance products will typically have a renewal limit on the coverage – most domestic medical insurance plans will no longer allow renewals of the policy once a certain age has been reached. It’s all very well and good being able to take the international health insurance plan around the world, but what happens when someone is no longer allowed to continue the policy because they’re too old?
Thankfully, many international health insurance plans are guaranteed renewable for life. This means that they can be renewed for as long as one wishes to do so, as the policy will continue to provide the required coverage as long as its annual premium is paid. This ensures that, on top of the global portability of these products, policyholders will always have the medical protection they need no matter how old they get or where they may ultimately end up after their travels.
In terms of the protection one is able to receive under an international health insurance plan, the coverage limits of these policies will far outweigh those which are available on local health insurance offerings.
In many cases International Health Insurance plans can provide coverage upwards of US$ 1 million per year, with many options actually offering coverage limits of around US$ 5 million per year. This gives travelers the assurance that should anything untoward happen while overseas that they will actually be able to receive comprehensive treatment, secure in the knowledge that they are fully covered by their international policy. The flipside, as we investigated last month, is that local health insurance plans will often have a high overall policy coverage limit, but will often have that limit occur on a lifetime basis – meaning that once the policyholder has reached the total coverage available under the plan they are no longer able for protection through their local medical insurance policy.
The coverage limits on international health insurance offerings are usually placed on an annual basis, meaning that this will be the total amount of care one can receive under the plan each year. While some international plans may include coverage limits which are applied on a per-condition or lifetime basis these tend to be the exceptions rather than the norm.
And finally we come to the burning issue of premiums and the costs involved of obtaining an international health insurance plan.
Unfortunately International Health Insurance plans will almost always be more expensive that Local Health Insurance options when the plan is first purchased. The reason for this is that International Health insurance products will normally have their premiums calculated on a community basis.
This means that the premium, roughly speaking, is based on the expected average yearly healthcare costs for all individuals of a certain age within a certain geographical area of coverage. As such, all individuals of the same age, within the same coverage area, holding a policy with the same coverage benefits, will usually pay the exact same premium.
Additionally, premiums for international health insurance plans which are calculated on a community basis will increase due to one’s age and the overall levels of global medical inflation. This means that the plan will get more expensive as one ages in order to cover the increased risk of their developing a serious medical condition. However, unlike domestic health products, a person’s claims history will not impact the plan’s overall cost – enabling one to actually use the policy and receive necessary healthcare secure in the knowledge that they will not be penalized for claiming under the policy.
The Bottom Line
International health insurance plans may be more expensive than local health insurance options, but will also provide higher levels of flexibility and usability. Able to move from location to location with the policyholder whilst providing high levels of coverage, an international health insurance policy is probably the best solution if one is planning on spending more than one year outside of their home nation and intend on residing, for a significant amount of time, in more than one country during their time overseas.
The differences between Travel Health Insurance, Local Health Insurance, and International Health Insurance products can be tough to identify for most people. Our guides on these types of coverage options for travelers should help travelers come to a better understanding of the pros and cons associated with each variant of health protection. However, take the time to shop around and really talk to a number of different insurance providers – the only silly question is the one which isn’t asked, and if there are any specific concerns do let the insurance company know.
Additionally, it is important to understand that there are a range of service providers able to help travelers find the best products outside of the insurance companies. From Agents to Brokers and Independent Financial Advisors, there is a wealth of resources available to travelers seeking medical protection whilst overseas. Take the time to shop around and really investigate the options.
Cooper, Claridge-Ware investigates the healthcare system in China, looking at the country’s top hospitals and identifying common issues faced by travelers and expatriates in the country. Stay tuned…
About Cooper, Claridge-Ware
Cooper, Claridge-Ware (CCW) is an independent International Health Insurance Brokerage headquartered in Hong Kong, China. With more than 55 years of experience in helping expatriates and travellers around the world find the best insurance solutions possible, CCW helps to simplify the process of identifying, and obtaining, high-quality medical coverage no matter where you may be.
For more information please visit www.ccw-global.com.