Experts, expats, veteran travelers, and parents all around the world agree – having health insurance is a wise choice if you don’t want to have to pay an exorbitant amount for medical attention. As a foreigner in a different country than your own, receiving medical attention can represent a significant cost in both money and stress. Depending on the local healthcare, taxation system, language constraints or a myriad other reasons, you most likely will be at a disadvantage in terms of accessing affordable healthcare of a decent quality. With health insurance of some sort, you can often both improve your access to care while mitigating the costs.
The problem is, with so many options available and how do you know which works best for you? Should you go with a local plan or an international plan? What is inpatient and outpatient coverage? What do I really need coverage for? What are deductibles? How can you make your plan cheaper? This article will help you to better understand international health insurance and what you can gain from it.
Let’s start with choosing a local plan or an international plan. The main different between a local plan and an international plan is the fact that an international plan is portable all over the world. If you’re an expat but you foresee yourself travelling around the world or the local area, international health insurance is a great purchase because it can cover you without needing to take out travel health insurance. Moreover, if you wanted to bring your plan back home to continue receiving comprehensive coverage, you can do so as well. Local plans are great if you intend to stay locally in the area and are generally cheaper in premium than a worldwide health plan.
A big deciding factor in choosing between local or international health insurance is renewability. With a local plan, your ability to renew your plan is affected by how many claims you make, the status of your health and sometimes your age. If you develop a serious condition, you might not be eligible for the same health insurance plan come time to renew your plan or your premium may go up exceedingly fast. With an international medical insurance policy, you are generally guaranteed to be able to renew your plan, regardless of what conditions you develop, or even your age (although typically you have to have applied to the plan by the time you are 65). This is particularly advantageous because you just don’t know when something may happen to you or when your plan may drop you as you get older.
Because of the fact that it’s portable, international health insurance provides an indirect benefit over and above local health insurance. There may come a time when you wish to leave the country, whereby your local health insurance will not be able to go with you. When you require medical insurance in your new home and if you previously developed a condition, you might not be able to receive the same level of coverage again. With an international health insurance, you guarantee your ability to have continuous medical coverage you can take with you, regardless of the conditions you may develop.
Insurance plans will usually have inpatient and outpatient coverage options. Inpatient treatment is coverage for anything where you have to stay overnight in a hospital – most surgeries fall under this category. Outpatient treatment is coverage for anything that doesn’t require an overnight stay, including visiting a general practitioner or getting a cast.
Sometimes the area that you are staying in will not have adequate medical expertise or equipment to treat your injury or sickness. Coverage options like medical evacuation are available to ensure that you are covered properly, bringing you to the nearest area which can provide you with quality medical attention. Generally, medical evacuation coverage is only available on international plans.
Another big difference between a local plan and an international plan is by how their premiums are calculated. A local plan calculates your premium by the type of plan you have, coupled with the amount of risk that you represent, which is usually assessed based on your claims history. If your health is particularly bad, then your premiums will probably be quite high. If your health becomes worse throughout the duration of the plan, you might be faced with an increasingly higher premium when you renew your plan. This is known as experience rating.
In contrast, an international plan will take into account the type of plan you have, your age, and the area that you are in. They will determine how much risk is represented by all the people in the same age group in the same area with the same coverage options and then determine a premium from there. This is called community rating. Since risk is quite dispersed, you will not see your premium rise significantly if you have been seriously or repeatedly injured or sick.
How might you make your premium costs lower? With international health insurance plans, you can reduce the cost by excluding areas of cover. Due to the fact that international health insurance premiums are determined by community ratings, the location will affect the price. Areas with high costs of healthcare, such as the United States, will cause the plan to be more expensive. You can elect to exclude areas from coverage to make the premiums lower. Areas of cover only apply to international medical policies.
Another method is through the use of deductibles. A deductible, sometimes known as excess, is a pre-defined amount of money set by the insurer, which you will need to pay before your coverage will kick in and the insurer will start to cover costs. The amounts can range anywhere from $0 to $400 to $2000 or maybe even more, depending on the insurer. There are three types of deductibles: per-annum, per-condition, and co-insurance. A per-annum deductible requires you to pay one amount a year after which your insurance will cover further costs. A per-condition deductible requires you to pay a pre-determined amount every time you require treatment for a new condition. Co-insurance is typically where you will need to pay a pre-determined percentage of the costs of any treatments. All types of deductibles will reduce the premium you have to pay. Deductibles will generally apply to both local and international health insurance.
That’s health insurance in a nutshell. How might you go about acquiring it? You have two options, both of which involve the internet. The first is to go directly to an insurer – they can provide advice on their products and find you something that can fit your situation.
The second is to find a broker – there are many brokers available and doing a quick internet search should provide you with a few options. A broker may be able to get you a lower price or more suitable coverage because they work with more than one insurance company.
Acquiring medical insurance can be a challenge and understanding the small print and particular benefits of your insurance options can be frustrating, but it is worth it if you want to adequately protect yourself. Whether you choose to go with a local or an international medical health plan, you’re making the right choice by getting it.
By Jenkin A.
Global Health Insurance