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Guide to Essential Money Tools
Healthcare Tools
Health insurance tools
Here, we explain the basics behind the labels to ensure you find what you need in your healthcare insurance policy:
Benefits
This is the label given to the specific areas of cover on offer within a plan. Health insurance benefits will include the mundane, such as drugs and dressings, as well as GP consultations, hospital beds and so on; it is also the name given to the more significant attractions, such as the allowance for an adult to accompany a sick child, not to mention emergency evacuation, alternative therapy treatment and even local burial.
Basic cover
A basic health plan which is sold without extra benefits should still cover a policy holder for all hospital emergencies – what’s called inpatient care. Included in this cover should be benefits such as local ambulances, drugs and dressings, and consultations with specialists.
Comprehensive cover
A step up from basic cover. By and large, this label covers out-patient as well as inpatient care. However, policy holders must read the list of benefits carefully and not assume any benefit is included unless specified. Particular attention should be paid to dental care, and various treatments such as physiotherapy. Check also the number of outpatient visits to a specialist care centre allowed in any one year.
Critical illness cover
Critical illness cover (CIC) provides a lump sum of money to a living policyholder upon diagnosis of one of a range of specific illnesses or upon the need of an operation. These being more usually cancer, heart attack, stroke, kidney failure, major organ transplant and coronary artery bypass surgery. CIC is offered to expats as either a stand-alone policy or it can be attached to other insurance related products. For instance CIC is often attached to an endowment mortgage policy.
Premiums
The name given to the annual cost of health care insurance. Always bear in mind that there are several factors which determine
premiums. Age and location in the world are two prime considerations. Another factor, of course, will be the type of policy you opt for. As one would expect, the more benefits included, the higher the price. There are various strategies one can adopt to reduce premiums. These include opting for higher excesses (see explanation under that heading).
Emergency Evacuation
Emergency evacuation is an absolutely essential area of cover for expatriates. Air-lifts to hospitals are often described as wings of mercy, particularly by those who have had to call upon such services. It’s one issue covering against unexpected illness or injury but quite another coping with every last detail of how and where such misfortune might occur. Often these events happen miles away from a telephone, or a place of assistance and in some cases the location of the injury could be so remote that accessibility is seriously problematic. This is where air-lift cover can prove crucial.
Accompaniment
Insuring your children within a family policy isn’t enough on its own to ensure that the right level of benefit is included. To appreciate how important accompaniment is you need to ask yourself some specific questions. Who will pay for you to accompany your child if an emergency evacuation is necessary? Who will pay for your accommodation while you are living away from your overseas home in order to be close to your child? This is a vital area of cover for parents and one which needs to be examined carefully, so be sure to read the small print. In some policies only insured adults are covered to travel with a child, or there may be a maximum age, or the escort might have to be a family member. The rules vary and it’s important to know precisely what your particularly policy is offering.
Pregnancy cover and routine complications
Maternity care is a classic example of a category which is an essential benefit to one family and a complete waste of premium to another. If you are starting a family, or plan to start a family, a policy which covers the cost of maternity and childbirth will bring a great sense of security and peace of mind. But if you know that this cover is not required, nor ever will be, it would be prudent to look more closely at plans which have this as an optional extra and not as an integral benefit. Maternity and pregnancy cover are usually divided into two categories. These are routine pregnancy cover and pregnancy complications cover.
Sporting injuries
Sports lovers should pay particular attention when researching, whether or not sporting injuries are included, as this is a particularly grey area. Insurance policy providers who do cover some sporting injuries do not always state as much in the policy literature. You may also find that some sports are covered, but not others. Unfortunately, it is down to the policyholder to check and check again.
Top-ups
Top-ups are also referred to as ‘options’ and ‘extras’. Many expats find that employers provide some sort of basic medical and health insurance cover for their time spent overseas. However, sometimes the cover offered can prove inadequate. It is essential to check what is on offer and attention should be paid to the percentage of expenses covered as well as the benefits listed.
To provide a typical example. Expat A discovers that although the company scheme includes his spouse it does not offer maternity benefit. Expat A and his wife are looking to start a family and so maternity cover will be an important benefit. Expat A will have to top up the basic package by buying maternity cover as a stand alone benefit. Because of the additional cost and administration involved in offering top-up cover, some insurance providers simply avoid it.
You may have to acquire your particular sought-after benefit by taking out a whole new policy. However, many expats have been able to negotiate top-up cover with their employers and have had their required benefits bolted on to the company scheme in this way.
What’s in the small print
The small print can tell you more about how your insurance policy will hold up in an emergency than any banner headlines. Here we explain how to read between the lines.
We have compiled a check list to help you decipher those paragraphs of small print. However, no amount of flag-waving by us can be a substitute for the actual task each expat should undertakewhen selecting health cover insurance.
You must go through the details yourself to appreciate what impact the particulars of your policy will have if you need to call upon it.
One further point to stress is that, however diligent you are in reading the small print in the policy document, the best way to appreciate the potential impact of any such detail comes from comparing one plan with another. By checking different terms and conditions, however, an expatriate in search of an all embracing healthcare insurance policy which won't let him and his family down will quickly realise that, as with all things in life, initial idealism may need to surrender to work-a-day pragmatism.
Ceilings
The term ‘ceiling’ refers to the maximum amount of money the policy holder is covered for under any one benefit. Were you as a patient to incur a bill above that ceiling it would be up to you, as the policyholder, to fund the difference.
It is worth comparing the benefit ceilings of several plans. Some are generous, matching the sum offered to the likely current cost of the requisite medical care, while others offer ceilings which are decidedly pinched and could leave you having to pay a hefty bill. Bear in mind that each benefit may have a ceiling price as well as there being an overall ceiling sum to each policy.
Excesses
This label refers to the amount of money the plan holder undertakes to pay before making any claim on the policy.
Excesses are cost aspects which are always worth taking into consideration. For instance, with dentistry some plans will ask the policy holder to pay the first £50 towards whatever treatment is required.
In some cases, taking on an excess can reduce the overall annual premium of a plan and thus prove a saving to the plan holder. It is always worth reaching for a calculator and totting up some projected figures to ascertain whether you would be better off reducing the premium and taking the risk on the excess, or vice versa.
Exclusions
Buried in the small print of every healthcare insurance policy will be a list under the heading ‘exclusions’. This list will detail those medical conditions which are not covered by the policy under any circumstances whatsoever. The list will also include those conditions in a patient which were present before the policy was purchased, known as pre-existing conditions (see below). So-called experimental or unproven medicine will also come under this heading. As one might expect cosmetic surgery usually makes an appearance here too, as do certain treatments around pregnancy and births; sex change operations; treatment for alcoholism, drug or substance abuse, attempted suicide, and elective treatment in the US. Whereas our list just touches on some of the exclusions, there is no uniformity between the plan providers, and every expat must check carefully to fully appreciate what is and is not covered.
Moratorium
A moratorium is a time frame linked to pre-existing conditions (see below) and can be defined as either a term before the policy commenced or after it started. The length of the moratorium can be a year, or longer, often depending on the age of the policy holder. Crucially, it is during this term that the pre-existing condition will not be covered for any treatment, surgery, or medical attention. With most policies, once this period of time has elapsed, then previously excluded conditions become eligible for cover in the normal way.
Some policies do not offer a moratorium on pre-existing conditions and expats need to think carefully before selecting such a policy. Very few of us reach a certain age without incurring some physical condition which won't reappear in later life. Think in terms of a tumble from a horse, or bicycle, or any injury resulting from an accident which could still flare up in the form of a swollen knee or back ache. Perhaps you suffer from migraine which hasn't troubled you for a while, but might come back, or perhaps it's an allergy like hay fever.
Such injuries and illnesses are classic examples of pre-existing conditions. The wording to watch out for when a moratorium is not offered is along the lines of, “all conditions pre-existing before enrolment are excluded in perpetuity.”
Pre-existing conditions
This label normally has its own clause. Defining a pre-existing condition can be problematic. The difficulty lies in acknowledging injuries relating to earlier illnesses or accidents. For example, imagine you had a back injury which has not troubled you for five years. And on signing up with a new policy, your back starts to trouble you again.
An insurance company might wonder whether this is an old injury flaring up again, and as such has not been declared, or a totally new injury which rightly should be covered for treatment. If in doubt about what to declare as a pre-existing condition it is always wise to seek advice.
If you have a known back problem which has caused you enough trouble to be entered into your medical records, then it is never wise to deny it.
Underwriters and insurance companies are extremely wary of deceit when it comes to claims. And be warned, checks will almost certainly be made, especially if a claim stands out in any way.
Settlement
A key point often over-looked at the enquiry/research stage, concerns the arrangements the policy has in place for settling medical and hospital claims.
Some policy providers have arrangements with a wide network of hospitals to pay direct. This leaves the policyholder, as a patient, unencumbered by paperwork.
Some policy providers operate a claims pre-authorisation system. This means that a checking call is made to the policy provider before treatment commences. Once the all clear for full reimbursement has been okayed, the patient may proceed with the treatment and the business of recovery free from the worry of bills.
With some plans the telephone check also includes a medical counselling and guidance service where patients can find out more about the drugs prescribed, the treatment offered and other medical concerns.
Territorial restrictions
The cost of healthcare and medical treatment around the world varies enormously. As a result, most healthcare insurance providers offer policies for certain areas of the world only. The usual geographic carve up is Europe, North America and the rest of the world. Always check which regions you are covered for and ensure that if you travel to areas outside those covered by the policy, top-up cover for the time spent away is arranged.