One of the major concerns for people living or working outside their home country for at least six m...
One of the major concerns for people living or working outside their home country for at least six months of the year is what happens if they become ill or if their spouse or child needs medical treatment.
It is important to know that they will have immediate access to adequate healthcare provision and that all their healthcare needs will be met by high quality professionals offering excellent treatment. Facilities overseas can often be quite different from those to which we are accustomed. Private medical insurance (PMI) enables members to either use the best facilities available in the host country, choose to return to their home country or move to another country to receive treatment.
Whether expatriates live in an underdeveloped or developed country, they share similar concerns. Those in underdeveloped countries with a poor medical infrastructure will want the reassurance that international insurance schemes can bring. Insurers can point them to the best medical facilities in the location or country where they happen to be. Expats will also want to ensure that direct settlement arrangements have been organised with both medical providers and clinical consultants and be reassured that the insurer can organise their evacuation should an injury or medical condition be serious.
Round-the-clock service
Where different time zones are involved, expats also want reassurance that they can still contact someone wherever they are, no matter what time it is. Consistent availability and high quality of service are essential.
In a more developed country, expats will want to be assured that the cover offered under the scheme will be sufficient to meet the costs of medical treatment in that particular country. They will want to be reassured that direct settlement arrangements have been put in place with the best medical providers.
There are also other key needs of customers that insurers have to take into account and accommodate. Some countries, for example Bahrain in the Middle East, will not cover the expatriate community. Expats and their employers will be forced to take out private schemes.
This will bring a plethora of associated issues, particularly if the local medical insurers have a lack of experience and service, or local healthcare provision is inadequate. In some instances, customers will want to pay for their premiums in a variety of different currencies and have their claims reimbursed or settled in different currencies.
A possible further complication is that the expatriate's expectations of good customer service will often be higher than those of domestic customers and these expectations need to be met, despite a more difficult operating environment.
Value for money is also a consideration and customers will want to ensure that as far as possible they can avoid all unnecessary paperwork and payment of hospital bills. Increasingly, they expect service providers to arrange settlement directly, alleviating the need for them to pay the bills themselves.
Expatriates and 'mobile employees' may take up a scheme directly or via their employer. However the schemes are taken up, they are designed to offer flexibility enabling the insured to take the cover with them as they move from one country to another. The schemes are typically structured over a 12-month period and will cover acute medical treatment for illness or injury. In addition, many products offer a range of other benefits either as part of the standard benefit or optional extras, for example cover for their family doctor, dental treatment both routine and emergency, optical cover, home nursing, evacuation cover, personal accident insurance and critical illness cover.
The schemes are usually priced around a number of risk factors such as the age of the insured, the regions of the world in which they wish to be covered, the choice of cover selected, the previous claims experience (where it is a large group scheme) and the inclusion of co-payments (employee contributions) and excesses.
Corporate purchasers
With the increasing globalisation of business, the distribution of a company's workforce is becoming even more widespread. As companies expand into emerging markets, they need to meet this growth with truly international staff, so corporate purchasers will want reassurance that appropriate cost controls and discounts have been secured on their behalf.
Setting up an international healthcare scheme can seem a somewhat bewildering prospect for the manager of a global business. Length of stay for employees in any one country can range from a couple of days to three years. Local medical facilities may be underdeveloped, complex and rapidly changing. Obscure administration processes may exist, there are often language problems and communication links can be weak. Access to medical facilities may be complicated and limited in terms of provision of speciality services and technology. Without access to specialist treatment, certain medical conditions can develop, and long and unsophisticated treatment periods can prove both dangerous and costly.
Employees often move around the world with their families at short notice. As they do so, they become exposed to numerous dangers and stresses. International employers increasingly recognise the need to manage their health care globally through a single international expert.
In order to select a high calibre international insurer, potential customers - either individuals or corporate buyers - are advised to consider the experience and reputation of the insurer, along with the financial security of the company when making a decision. For reassurance that the country in which they reside will be covered, they should check the extent of the network of overseas service and contact centres, and the medical providers with whom direct settlement arrangements have been organised.
The price is of particular importance to individual members and to ensure they are receiving value for money they should explore the scope of coverage offered by the schemes. They need to be aware that medical costs, both in terms of surgery and accommodation, vary considerably. In addition to the actual costs, there should be flexibility in terms of collection of premiums (method of collection and currency), the design of the policy and the service.
If the customer is a career 'mobile employee' then they should check out the transportability of insurance. On a practical level, the provider should be able to ensure 24-hour multi-lingual customer service and guarantee quality of service delivery.
The number of people taking up international insurance and the nature of their needs makes interesting reading. Measuring the size of the expatriate market and ascertaining their location is a complex task. However, based on experience, some broad assumptions can be made. Among highly developed countries, the expat community - US nationals residing overseas, for example - will account for between 2%-3% of the population. Among developing countries, expats will constitute between 1%-2 % of the domestic population.
Insurance alternatives
It is also important to take into account that a high proportion of expats may not protect themselves with international policies when going overseas, preferring to pay for treatment in cash or seek alternative insurance schemes such as travel insurance or local medical insurance schemes. In fact, estimates suggest that up to 50% of expatriates fall into a non-medically-insured category.
When considering insurance alternatives, a number of issues need to be borne in mind. Travel insurance schemes, for example, are not tailored to meet the needs of the resident expatriate. Benefits may not be sufficient to meet needs. The scheme is unlikely to have an accredited international hospital network and direct settlement in many cases will not exist. In addition, time restrictions on travel schemes will mean the resident expat will not be appropriately covered. But the most important obstacle against using these policies is that they do not cover elective medical treatment.
Local policies are not always cheaper - certainly not in most European countries or the US where medical insurance costs are extremely high. Also, local insurance companies are not international so the range of their services is limited.
Continuity of cover is also an important factor. Expats moving from one country to another and buying local cover would be re-underwritten by each separate insurer, potentially getting less and less cover for their money with each move. This is particularly significant when an expat returns to the UK and is no longer covered by a company policy.
Expats will find that cover will be limited to local domestic facilities and the schemes will be designed around local benefit levels. There may be issues relating to the reliability and security of the local insurer. Communication is likely to be in the local language, which may present problems in understanding the policy and customer service/claims. The local healthcare infrastructure may be poor and may not include evacuation. Customer service standards may be inferior to those to which the discerning customer is familiar.
For peace of mind, therefore, clients intending to live or work abroad would be better off taking out PMI from a reputable international insurer rather than relying on local insurance or amenities.
Bill Ward is director, general manager at BUPA International
