What to consider before buying international health insurance

A good insurance plan can keep your mind at peace, especially when you are living abroad. Subsequently, you need to choose your insurance policies with care. There are certain things to consider before buying international health insurance. Each one needs to be carefully understood, so that you will be able to pick a policy that will serve you well in case of a medical emergency. So how buying international health insurance ?

1. What is not covered?

Most insurers have a list of conditions and treatments that are not covered and it differs from one to the other. The most common exclusion is pre-existing conditions. In such a case, even if some insurers cover these pre-existing conditions, there will be a loading to the insurance premium.

Listed below are some of the most general exclusions:

• Addictive and mental conditions and disorders (some insurers might cover treatment on a discretionary basis)
• Allergies and allergic disorders
• Artificial life maintenance
• Birth control (contraception, assisted reproduction, sterilization, abortion, etc.)
• Conflict and disaster (treatment as a result of nuclear or chemical contamination, war, disaster, etc.)
• Cosmetic and plastic surgery (unless it is administered immediately after an accident or disease, e.g. breast reconstruction after mastectomy and sometimes lumpectomy which can take place simultaneously during cancer-removing surgery, or months to years later)
• Obesity
• Congenital conditions

It is important that you understand what you need covered and what your policy actually covers. Your consultant can help you review your current policy, and guide you through your research and decision-making process. 

2. Annual deductible

An annual deductible is the total amount you have agreed to pay each policy year before receiving any reimbursements from your insurer. For e.g., if your annual deductible is US$500, and the total amount you have paid for one or various eligible treatments is US$2,500, your insurer will pay out US$2,000 to you and the cost of all other eligible treatments thereafter within each membership year. Deductibles can be per policy or per medical claim, and can range from US$50 to US$10,000.

One of the ways to make your medical insurance more affordable is to increase your annual deductible. In some cases, your premium may be reduced by up to 70%. 

3. Waiting period

The waiting period is the length of time you have to wait before making any claim for that particular treatment or for the policy to be enforced. In the event of an acute (short-term) sickness, serious illness, or injury, most insurers will cover immediately or when the insurer accepts a transfer.

Waiting periods are imposed to prevent any abuse of the system. Generally, waiting periods are applied to the following:

• Dental – 6 to 9 months depending on the procedures carried out
• Orthodontics – 6 to 24 months
• Maternity – 8 to 12 months
• Wellness (mammogram, PAP smear, prostate cancer screening, etc.) – 12 months
• Pre-existing conditions – 24 months

When buying as a group, some waiting periods may be waived. It is important to understand your personal circumstances, plans and needs in order to select the most appropriate product. 

4. Claims

The main reason to purchase international medical insurance is to ensure that you receive financial cover whenever you need it. Thus, it is important that you have a clear understanding of the claim procedure. Ensure that you have access, at all times, to your policy details and all the relevant information in case you need to contact your insurer. Your insurer’s medical helpline should be available to you 24 hours a day, 7 days a week, in multilanguage.

To make a claim:

• you can either pay first and claim later. This is the case for most outpatient treatments. Most insurers will require that your doctor complete the claim form. So, ensure that you have the forms when you receive treatment.
• your insurer will pay directly to your clinic or hospital due to the direct payment network already established or payment guarantee issued prior to treatment or admission.
• in case of immediate hospitalization, most insurers will pay out directly, provided they are informed within the time period set out in your policy agreement – usually within 48 hours of admission. Failure to do so will mean that you may only be eligible for reimbursement of a proportion of the cost incurred.

Most insurers will require a doctor’s or specialist’s referral when you claim for the following:

– Physiotherapy

– Chiropractic treatment

– Acupuncture treatment

– Osteopathic treatment

– Homeopathic treatment

– Podiatric treatment

5. Problems with claims

Before going for any treatment, if time allows, do check with your insurer to find out if it is covered under your policy. To avoid any delay or rejection to your claim, ensure that information required is fully completed and that your insurer receives the claim within the time period set out by your insurer – usually within 3 months of receiving the treatment. If all claim procedures are adhered to, normally, you should receive your claim within 2 weeks.

6. Overall annual maximum

This is the total amount that your insurer will pay out per member per policy year. Meaning, if your overall annual maximum is US$1,000,000, it means that you can claim up to US$1,000,000. Ensure that you take note of the benefit limit which applies for each condition as well. For e.g., if your benefit limit for maternity is US$7,000 and your bill comes up to a total of US$8,000, your insurer will only pay US$7,000. Only US$7,000 will be added to your overall annual maximum.

For international health and medical insurance, the overall annual maximum is usually between US$1,000,000 to US$2,000,000. Else, there is no limit at all.

7. Maternity

Maternity is another thing to consider before buying international health insurance. Most international health insurers provide maternity benefits. The waiting period could be between 8 to 12 months depending on the insurer. The benefit limit can go up to US$14,000 depending on the insurer’s definition, whether it’s a normal delivery, medically prescribed cesarean or delivery following fertility treatment (some insurers exclude pre and post-natal treatment for delivery as a result of fertility treatment).

Maternity benefits usually cover:

• pre and post-natal care and treatment
• delivery costs (home, normal, medically prescribed cesarean or following fertility treatment)
• complications of pregnancy
• routine newborn care (usually for up to 7 days following birth)

8. Guaranteed lifetime renewal

Being covered at all times is of utmost importance. In fact, it is your responsibility towards your loved ones. Not all products are created equal. Some policies insure up till age 65 and some go beyond age 80. Others policies guarantee renewal no matter how your health condition has changed during the policy year. Some will adjust benefits without these being reflected in the premium. Other insurance will reject renewal leaving you with no cover at all. When buying an international health and medical insurance, it is important to plan long-term and protect yourself from unnecessary future expenses.

It is therefore important that you work with a professional to help you determine your needs and requirements and identify the most suitable product(s) within your budget.

9. Medical evacuation and repatriation

What is the level of medical facilities in your country of residence? Unless you are based in a developed country with an excellent level of medical facilities, medical evacuation is usually an essential part of an expat medical insurance package.

A medical evacuation is only executed when the medical treatment required is not readily available locally or at the place of accident and is medically necessary. Insurers will pay for the cost of moving you to the nearest medical facility to receive treatment. The cover will usually also include the cost of one other person traveling with you.

Medical repatriation is executed under the same condition as a medical evacuation. However, it gives you the option of getting treatment in your home country, in a familiar environment, near your friends and family.

Some insurers provide the flexibility to delete or add-on either medical evacuation or medical repatriation in your cover.

10. Area of coverage

Most insurers have 2 categories: worldwide and worldwide excluding the USA. Some insurers have a more specific geographical breakdown. Of course, the premium increases with a wider area of coverage. One of the ways to reduce your premium is to define your area of coverage. In some cases, with better definition, it could reduce your premium by 60%. 

11. Pre-existing conditions

This is one of the important things to consider before buying international health insurance. Even though various insurers may have different definitions of a pre-existing condition, it is generally defined as a medical condition that existed prior to obtaining your medical insurance. This can be as simple as a hay fever, or a previous diagnosis of a cancer.

Prior to an insurer approving your application, you will be asked to complete a medical questionnaire. It is very important that you provide all the information required as accurately as you can. If in doubt as to what to disclose, it is better to err on the side of caution and do so.

With this information, the insurer will then decide the status of your application – what to cover or not to cover and how much to cover. Should an insurer decide to cover your pre-existing condition, it will be accepted based on certain terms and conditions and at a higher premium. How much more will depend on the type of pre-existing condition and the insurer. An insurer may decide to exclude your pre-existing condition in your policy or in some extreme cases, reject your application.

Insurers will usually impose a waiting period. This means that treatments or claims pertaining to your pre-existing condition or related condition will only be covered after the waiting period. This could vary from six to twenty-four months, depending on the type of pre-existing condition and also on the insurer.

In excluding the pre-existing condition in your policy, the insurer will not cover any treatment pertaining to that particular condition or any related condition. Thus, it is important that your doctor report the correct diagnosis in your claim.

12. Moratorium

Usually, pre-existing conditions that have occurred 5 years before your policy starts will be excluded. If no claim has been made on the pre-existing condition or related condition for a continuous period of 2 years, it will then be included in the cover. If a claim has been made during this two-year period, the two-year qualifying period starts all over again.

It is important to point out that there are many pre-existing conditions that will never be covered by a moratorium policy, such as:

• Diabetes
• Hypertension (raised blood pressure)
• Hyperlipidaemia (raised cholesterol level)
• Ischemic heart disease
• Cancer
• Thyroid disease
• Autoimmune disorders
• Arthritis

13. Chronic conditions

Chronic condition is defined as a disease, illness or injury that possesses at least one of the following characteristics:

• ongoing and has no known cure
• likely to reoccur
• permanent
• requires long-term treatment

This includes heart disease, stroke, cancer, chronic respiratory diseases, arthritis and diabetes. Visual impairment and blindness, hearing impairment and deafness, oral disease and genetic disorders are other chronic conditions. These diseases are often preventable, and frequently manageable through early detection, improved diet, exercise, and treatment therapy.

According to the World Health Organization (WHO), 60% of all deaths globally are due to chronic diseases. Of the 60%, 20% occur in high-income nations and the remaining in low and middle-income countries. In the European region, 86% of deaths are caused by chronic diseases. In the U.S., 7 out of 10 deaths among Americans each year are from chronic diseases. Heart disease, cancer and stroke account for more than 50% of all deaths each year.1 In Asia (particularly in China and India), chronic diseases are increasing.

Each year, 8 million deaths from occurring chronic diseases are among those between 30 and 69 years of age.2 One of the common misunderstandings of chronic diseases is that it only happens to old people. Research has shown that 50% of deaths from chronic disease happens to people under 70 and 25% to people under 60. Common causes of chronic diseases are unhealthy diet, inactivity, smoking and excessive drinking.

Policies that cover chronic conditions are naturally more expensive. Most insurers will set limitations to the kind and cost of treatment, such as setting a lifetime or annual limit to claims pertaining to chronic conditions. Some will not offer cover at all. If you determine that you are in the low risk category, you can use your own judgment to delete this cover.

How cover ?

Then again, having said that, there are also rare cases where a perfectly healthy young individual develops a chronic illness. And should that happen, it will be seen as a pre-existing condition which many insurers may not be willing to cover or it will be covered at a very high cost.

Most insurers will exclude chronic illness and pre-existing condition. However, most will cover cost for treatments required to stabilize the health condition of the insured. Some insurers may accept to cover pre-existing conditions depending on how your policy is underwritten.

At Expatmedicare, we have your best interests in mind. If you would like to know more about the things to consider before buying international health insurance, or have any questions regarding the same, please contact us or visit our website. 

Reference:

1 Kung HC, Hoyert DL, Xu JQ, Murphy SL. Deaths: final data for 2005. National Vital Statistics Reports 2008;56(10).

2 A.D. Lopez et al., Global Burden of Disease and Risk Factors (GBD, 6).