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Most of us have heard horror
stories about inadequately insured travelers who
go off on holiday feeling perfectly well and
then an unfortunate accident puts them in
hospital. These unlucky folks find themselves
very far from home without personal support
systems in place and they're left with thousands
of dollars in unpaid medical bills. Not fun! By
reading this information will give you a basic
understanding of the most important factors to
consider when choosing a travel insurance
policy.
First
off, if the world of travel insurance was not
confusing enough, the events of Sept. 11
have made it even more so. Now more then ever it
is very important to read a travel insurance
policy's fine print
Many trip-cancellation
policies used to pay if your tour operator or
cruise line went out of business, a so-called
financial default clause. But since Sept. 11 and
the travel industry financial problems that
followed, some have eliminated such coverage or
limited it to certain companies.
More cruise lines have begun selling
"cancel for any reason" waiver
programs, some of which allow you to cancel as
late as the day of departure. Such programs
typically do not pay if the cruise company goes
out of business or files for bankruptcy. But
they can be useful if you think your travel
plans may be in flux.
The Plans
There are many types of
insurance for the world traveler and choosing
the right plan can be confusing. Becoming
familiar with the basic types of plans and the
specialized terms will make it easier to compare
plans, and ultimately choose the right plan for
your needs.
Often people think travel
insurance means flight accident insurance, i.e.,
the kind of insurance that pays the insured or
its beneficiary a lump sum when an airplane
accident results in death or serious injury.
Flight accident insurance plans are commonly
found at airports and they pay substantial sums
to accident victims and their families.
However, there are two other
primary types of travel insurance that are
designed to reduce the financial risk posed by
unforeseen medical expenses and other crises
that can confront international travelers.
Although the distinctions can be blurred between
the two types of plans, they are generally
categorized separately as international medical
insurance and travel protection plans,
both of which may be offered in single-trip,
multi-trip, or renewable versions.
International Medical
Insurance - is short or long term
medical insurance designed to reimburse you for
medical expenses incurred when you are traveling
or living in a foreign country. Maximum policy
coverage levels can be substantial enough to
cover major medical expenses such as emergency
surgery and extended hospital stays. The
"American-style" of international
medical insurance coverage is subject to the
specified deductible and co-insurance or co-pay.
Plans may include emergency evacuation, reunion,
and repatriation benefits as well as other
travel assistance services.
Travel Protection
Plans - typically reimburse your
non-reimbursed travel expenses if an emergency
(death, sickness, airline strike, travel company
bankruptcy, etc.) occurs right before or during
your trip causing it to be canceled, interrupted
or delayed. Often these plans include travel
assistance services, protection for lost or
damaged baggage, as well as limited coverage
for incurred medical expenses. In many cases
there is no deductible or co-pay for covered
medical expenses.
Helpful Information For
Students
The International Student
Travel Association (ISTC) is a good resource for
students to find out about international student
ID cards, some of which offer limited travel
assistance services, but these ID cards focus
more on entry fee reductions at popular tourist
attractions and other retail discounts.
Remember, travel assistance services offered by
cards and associations likely do not include any
international medical insurance coverage or
travel protection benefits. The card issuer may
recommend a reputable insurer but international
medical insurance and travel protection plans
must nonetheless be purchased separately.
Some countries require that
foreign visitors provide proof of adequate
medical insurance for the duration of their
visit, especially when staying for extended
periods of time.
In particular, students
planning to study abroad should be aware that
they are usually responsible for the medical
expenses that they incur while studying,
traveling, and living in the United States and
other countries. To ensure that visitors to the
US have adequate financial resources to pay for
health care treatment, the US government
requires that holders of "J" visas
have appropriate health insurance coverage.
There have been proposals to extend this
requirement to holders of "F" visas as
well. Be sure to find out what is required for
you.
Travel Insurance Online
Although there are more and
more web sites that offer travel insurance
online, most sites offer only one type of
coverage -- either a travel protection plan or
international medical insurance -- or only offer
coverage to citizens of a particular country. A
select few offer a variety of plans for world
travelers of all nationalities.
For medical emergencies:
Well before your trip, review the variety of
types of assistance to which you already have
access. For medical emergencies, your
regular health coverage probably will cover
expenses anywhere, reimbursing you for your
out-of-pocket expenses. Be sure to bring back
adequate receipts and treatment records (in
English, or you'll be required to provide
translations).
Get the details from your agent or employer;
especially inquire about medically required air
evacuation. Blue Cross and Blue Shield (known in
the insurance industry as the
"Blues"), for example, have agreements
with 182 hospitals in 52 countries where members
can be admitted with their membership cards.
Members will be treated as if they were in a
Stateside hospital, with the billing going
directly to the "Blues."
(Incidentally, the "Blues" comprise
regional, independent companies and some do not
provide this service. Ask your employer or
insurance agent whether or not you have this
specific overseas coverage.)
Blue Shield of Northern California has a small
brochure entitled "Passport" that can
be taken along, offering detailed instructions
on how to utilize their overseas coverage. Your
insurer may have a similar guide.
In most cases, if you have regular health
insurance, buying an additional travel policy is
of limited value, since most of these provide
only "secondary" coverage; that is,
they pay only what your normal insurance does
not. The only advantage is that they may pay
your bills overseas and then settle later with
your normal insurer.
Credit cards, especially "Gold" cards,
have "hotline" phone numbers that
provide a variety of assistance functions and in
emergencies can increase your credit limit. They
often will assist in "arranging"
for" more-expensive services, but the
cardholder usually is responsible for the cost.
You must make sure to take along the
"hotline" phone or fax numbers for
contacting whatever assistance services you have
available. Medicare does not provide overseas
coverage, but many "Medi-Gap" policies
do.
Medical evacuation:
You are likely to find that you already are
reasonably well covered for health/accident
emergencies, with the exception of
transportation to an appropriate medical
facility or for very rare - but also potentially
very expensive - air evacuation back to the
U.S.
Here are samples of the most important services
you should need. It is very important that
you attempt to locate insurance with no
preexisting-condition exclusion of any kind, or
one that has the least amount of
exclusions. Remember exclusions can cost
you a lot of money:
1) Traveler insurance should supply and pay for
emergency evacuation to the nearest facility
capable of providing proper care. When the
patient is stabilized, they will transport him
or her back to the United States under medical
supervision, if necessary, with no upper limit
on cost.
2) when a member is traveling alone and is to be
hospitalized for more than seven days, economy
round-trip transportation to the place of
hospitalization will be provided, without
charge, to a person chosen by the member.
3) Admission to a hospital will be guaranteed -
so that the member will be admitted promptly -
by either validating insurance or advancing
funds (which must be repaid within 45 days).
4) Plus, without charge, be referred to an
English-speaking doctor, supply critical-care
monitoring, deliver medications that might not
be available locally, keep you in touch with
your family, provide legal referrals and provide
pre-trip up-to-date health
precaution recommendations for your destination.
5) And, grim note, but it can happen, they
should provide assistance for
and pay the cost of return of mortal remains.
Travel insurance policies:
Lets take a look at the
various parts of a travel insurance policy:
The "preexisting condition":
If you have a preexisting medical condition, be
careful in your choice of insurers. Some
policies (including trip
cancellation/interruption) are restrictive in
coverage of claims that are related to
preexisting medical conditions within various
periods prior to your trip. (They may be a good
value for someone in good health - because of
higher limits, more features and for lower
costs.) Some companies will cover problems
related to preexisting medical conditions if
that condition has been controlled during the
period
preceding the trip.
Look for the carefully worded section of the
brochure entitled "Exclusions" or
"Preexisting Conditions." The ground
rules may be different for the health/accident
portion of the coverage and the trip
cancellation/interruption portion.
"Controlled" usually is defined as
"exhibiting no symptoms or not requiring
the adjustment of treatment or medication."
Look for that word "controlled" in the
text, if this is an area of concern for you or
your traveling companion.
If you have been taking medications or have been
treated by or have even seen a doctor for any
medical condition within the previous six
months, make sure that you get a policy that
uses the "controlled condition"
language.
Even then, a change in the prescribed dosage of
your medication in the months before your trip
would jeopardize your coverage for a related
problem.
Don't be intimidated by "fine print";
most brochures clearly describe the principal
details and exclusions. Take the time to read
carefully before you sign up.
Tour company offerings:
Tour companies are increasingly offering trip
insurance (or its equivalent) that covers
medical and/or cancellation features; look for
the same "controlled"
preexisting-condition language. These plans can
be a good value if the price is significantly
lower than standard insurance policies.
If the tour company is making the guarantees
instead of an insurance underwriter, the
guarantee would be of questionable value if the
tour company suddenly closed up shop.
Don't worry unnecessarily about this hazard; the
likelihood of company failure is reasonably
remote and tour operators contribute to a fund
of last resort that will reimburse customers for
at least a portion of their lost funds.
Discuss this with your travel agent you can
spend an unreasonable amount of money trying to
insure against every single possibility.
Trip cancellation/interruption insurance:
Health and accident problems are the most common
causes for claims under these coverage's. The
preexisting-condition exclusions and
recommendations are especially important here.
Look for a policy that will provide coverage for
rescheduled flights
home; many tour packages utilize special fares
that do not provide for schedule changes. Also
be aware that frequent-flyer-supplied flights
are not insurable (refundable) by the insurance
company.
In case of any emergency problem, it is
worthwhile to contact the public relations
representative of the airline (even if it
requires a few calls from overseas) to see if he
or she might make some accommodation because of
the special circumstances.
Trip cancellation/interruption insurance is
rather expensive: 5% to 8% of the insured
amount. A couple spending $2,000 each for a trip
will pay $200 to $300 for cancellation coverage.
The insurer will pay up to the covered amount
and may have to pay as little as a fraction of
the cancellation fee or your pre-trip deposit,
depending on when the cancellation is made and
why.
A logical strategy, whether or not you purchase
cancellation insurance, is to avoid making the
required incremental payments for a tour until
shortly before the deadlines...to minimize your
exposure, in case something unexpected comes up.
In considering travel insurance, make a choice
with which you will be comfortable. Then you can
enjoy your trip, confident that you won't be
worrying about "What if?"
Follow the Scout motto of "Be
prepared." You can go without additional
coverage, go "bare-bones" or buy a
"deluxe" package that will cover you
even if you should get bitten by a penguin in
the Amazon (slight exaggeration)
Check any health policies you already have very,
very carefully. Find out if your coverage
extends to emergency medical services outside
the country, what that coverage entails and
whether that coverage is adequate if something
goes terribly wrong on your holiday. Then begin
shopping for any extra protection you might
need.
Don't take chances.
Understand, that whether you are out of the
country for two hours or two months, accidents
are never planned and ill health can come on
very suddenly . You could find yourself too sick
to travel home for medical treatment and we all
know how expensive even a short hospital stay
can be. Be aware that you can't just buy your
insurance when you start to feel badly. Policies
must always be paid in full prior to your
departure.
Do your research . Allow the
same time and consideration for picking your
policy as you would to deciding on a
destination, shopping for your airline ticket or
buying a backpack that's just right for you. The
wrong backpack can mean a sore back. Choosing
the wrong insurance could mean thousands and
thousands of dollars in unnecessary debt!
Personalize your policy.
Think carefully about the kind of coverage you
need. Are you pregnant? Is this a skiing
holiday? Are you traveling with children? Are
you a diabetic? All of these factors will play
an important role in your choice of policies and
they must be considered very carefully. For
example, did you know that many policies don't
automatically cover pregnancy-related conditions
or nursery care for premature infants?
Every insurance company
should provide an agreement booklet that
outlines in detail what type of coverage they
offer in each of their policies. Ask for a copy
of this contract before you commit yourself.
This is a perfect way to compare benefits.
Remember, you get what you
pay for! Never buy your policy based solely on
the amount of the premium. If one insurance
company is charging far less for premiums than
another, be wary. This is the time to ask a lot
of hard questions because chances are the
coverage will be far less, too.
Never lie! Emergency health
insurers have very stringent rules in regard to
pre-existing medical conditions. Discuss these
carefully with your insurance company. It's
absolute folly to go off without advising them
of your medical problems because, in the long
run, you will probably lose your coverage and no
payments will be made.
Ask about the company's
emergency procedures. What happens if you become
injured and need medical assistance immediately?
Is their Assistance Center staffed 24 hours a
day? How quickly and effectively will their
medical staff react to your particular needs? If
their 800 emergency number doesn't operate from
where you are, will they accept collect calls?
Will the person at the other end of the line
speak English?
Find out about the
non-medical services your policy provides. If
you are traveling with a child and you're the
one who's hospitalized, will there be provisions
for the interim care of the child? Will they
help if your passport or airline tickets are
lost? You tend not to think about these things
as you're setting off on holiday but they become
so important when you actually find yourself in
trouble.
Finally, we suggest that you
do your networking with other traveling' women.
Sound out your pals about companies they've
dealt with and how well their claims were
settled. Ask them to assess both the medical
services and the non-medical services. You'll be
surprised at the helpful bits and pieces of
information you can pick up along the way.
Health care around the
world isn't always perfect
Hong Kong is reputed to have
the world's most expensive medical care.
In developing countries,
needles, syringes and IV administration
materials may be re-used without adequate
sterilization. Consider bringing a personal
medical kit with a supply of disposable
products.
Many hospitals in China
derive a substantial amount of their revenue
through drugs prescribed by staff physicians and
sold at on-site hospital pharmacies. Therefore
not only might doctors prescribe more drugs than
you need but you will possibly be overcharged
for your drugs as well.
In Mexico, some medical
providers work in conjunction with air
ambulances to pressure patients into paying for
expensive (and sometimes medically unnecessary)
emergency evacuations. It is important to have
an assistance company that can provide
appropriate medical referrals and assist you in
making safe and cost effective evacuation
arrangements when required.
In Eastern Europe and the
Former Soviet Union, routine first aid supplies
and feminine hygiene products are often hard to
find and expensive where available.
Thee ambulance drivers in
China are not required to have any medical or
first aid training .
Check your policy
carefully...
Be aware! If you plan on
taking part in any sports that are considered
hazardous, you might not be covered by your
insurance policy. Dangerous activities include:
- parachuting,
- para-sailing,
- hang gliding,
- bungee jumping,
- mountaineering,
- cave exploring,
- SCUBA diving (if you
don't hold a basic SCUBA designation from a
certified licensing body).
Glossary of Terms
Travel Assistance: Travel
Assistance services may be bundled into
an international medical insurance or travel
protection plan, but these services are not
considered insurance. The term travel
assistance covers a broad range of services,
often including but not limited to: toll-free
multi-lingual 24-hour emergency telephone
numbers, local offices around the world, web
sites offering aid and advice to travelers in
need of travel, medical or legal help,
translation services, passport and visa
assistance, assistance filling prescriptions,
and virtually any special assistance useful to
travelers in crisis who are far from home.
Some credit cards and
international student identification cards and
associations offer complimentary travel
assistance benefits to their cardholders and
members. However, keep in mind that although
travel assistance services can provide instant
help with a free phone call when needed most,
not all services are free of charge once
rendered. Many specific travel assistance
services, such as legal counsel or translation
services, are provided without question at the
time of need, but with the clear understanding
that the traveler will subsequently reimburse
that service provider at a later date when the
traveler is in a more convenient position to pay
for the service(s) rendered.
Maximum Policy
Coverage: This is the maximum
amount of money that the insurance provider will
pay for covered expenses. This may be an overall
maximum or an amount for each accident or
illness.
Deductible:
(Also known as excess in UK, NZ,
AU) This is the amount that the insured must pay
before the insurance provider starts paying.
This may be an annual amount, an amount for the
duration of the policy, or an amount for each
incident.
Co-Insurance or
Co-pay: This is the percentage or amount
of expenses that the insured pays (if any) after
the deductible is paid. Example:
"Co-Insurance = 20% or co-pay is
80/20" means that the insurance company
pays 80% of the charges, the insured pays 20%.
Often there is a maximum co-pay amount, i.e.,
a limit or ceiling above which the insurance
provider pays 100%. Example: "Deductible =
$250 and 80/20 co-pay up to $5000, then 100% up
to policy maximum." This means the insured
is required to pay the deductible of $250 plus
20% of expenses up to $5,000, and the insurance
provider pays 100% of covered expenses that
exceed $5000 up to the maximum policy coverage
limit. Thus, if total expenses exceed $5000 (e.g.
$20,000 in total medical expenses) then the
insured pays $250 (deductible) plus the co-pay
maximum of $1000 (20% of the first $5000) for a
total out of pocket cost to the insured of
$1250, and the insurer pays the remaining
$18,750 of expenses. Where total expenses are
only $3000, then the insured pays $250
(deductible) plus $600 co-pay (20% of $3000) for
a total out of pocket cost of $850, and the
insurer pays the remaining $2150 of expenses.
Expenses:
These are the expenses an insurance provider
will consider for payment. These normally
include expenses for surgery, hospitalization,
doctors’ services, x-rays, laboratory tests,
prescription drugs and other treatments. Some of
these expenses may be limited by the insurance
contract. See exclusions.
Exclusions:
These are the expenses that the insurance
company or travel protection provider will not
pay. Examples include: expenses resulting from
illegal drug use, conditions which existed prior
to the purchase of the insurance (see
pre-existing conditions), participation in
various dangerous activities, participation in
certain types of sports (see hazardous sports
and activities coverage), etc. Most insurance
contracts have many of these exclusions. It is
important to read brochures carefully.
Premiums: This
is the amount that you pay to purchase
international medical insurance
coverage or travel
protection plans. Premiums may be paid in
advance, on a per trip basis, annually, monthly,
quarterly, or by semester, depending on the
policy. Premiums for travel protection plans are
usually paid in advance, either annually or on a
per trip basis.
Emergency Medical
Evacuation, Emergency Reunion, and Repatriation
Benefits: Emergency medical
evacuation means covering the expenses for
sending an injured or ill person home or
transporting him/her to a place where
appropriate medical care can be obtained.
Emergency reunion means covering the expenses
for having a family member brought to the
injured or ill insured during a medical
emergency. The repatriation benefit pays the
cost of preparing the body of a person who dies
in a foreign country and returning the body to
the deceased's home country. These benefits are
often bundled together and included in
international medical insurance and travel
protection plans.
However, these benefits can
also be bundled together and offered as an
economical stand alone annual plan, with no
medical insurance or travel protection
components, but with virtually unlimited
coverage for emergency medical evacuation. For
frequent international travelers, this type of
stand alone plan is a prudent option to
consider, especially for those with adequate
worldwide medical insurance. This is so
primarily because the emergency medical
evacuation coverage that is included with most
international medical insurance and travel
protection plans is limited to a pre-set maximum
dollar amount, usually $20,000 - $50,000. It is
not uncommon for emergency medical evacuation
costs to exceed the common pre-set limits by
tens of thousands of dollars, especially when
evacuation is from a remote location.
Insured: This
is the person covered under an insurance policy,
i.e., the person for whom the policy was
purchased.
Pre-existing
Conditions: Medical conditions
associated with the insured (or a spouse, travel
companion, or close relative in the case of
travel protection plans where trip cancellation
results from the medical condition of someone
other than the insured ) that existed before the
plan or policy took effect are pre-existing
conditions.
Many plans and policies
offer limited or no coverage for medical
expenses or trip cancellation expenses resulting
from pre-existing medical conditions. These are
known as pre-existing conditions exclusions.
Most plans specify a maximum amount of time
prior to the effective date of the policy during
which the manifestation of any pre-existing
conditions would constitute exclusions. Example:
Pre-existing conditions exclusions are limited
to "five years prior to the effective date
of the policy." This means any expenses
resulting from medical conditions that were
manifested or treated within the last five years
would not be covered. However, when purchasing
some travel protection plans, particularly on a
per trip basis, pre-existing conditions
exclusions may be waived if the plan is
purchased within a certain number of days after
the initial trip deposit is paid (often 7-10
days).
Hazardous Sports &
Activities Coverage: Coverage for
medical expenses resulting from engaging in
certain hazardous, high risk sports and
activities such as scuba and sky diving, rock
climbing and bungee jumping (to name a few), is
often explicitly excluded by international
medical insurance and travel protection plans;
however, some plans offer special hazardous
sports and activities coverage that is optional
and usually results in a only a modest increase
in premium. Always make sure you are aware of
the exclusions noted in the plan or policy you’re
considering, and if you plan to participate in
any high risk activities, look for plans with
optional, supplementary hazardous sports and
activity coverage.
Accidental Death and
Dismemberment: Benefits paid in large
lump sums to the insured or the insured’s
beneficiary in the event that the insured
suffers the loss of a major body part or is
killed.
Single-Trip: Single-trip
plans cover one trip.
Annual/Multi-Trip: Annual
or multi-trip plans cover all trips taken within
a year (often with a maximum duration of 30-120
days per trip).
Individual Plans: Individual
plans are designed and priced to cover one
person.
Family Plans: Family
plans are designed to cover all members in a
family traveling together, and premiums are
usually priced at a discount compared to the
rate for a single person. Some family plans
include relations beyond the immediate family,
such as grandparents and in-laws.
Primary Coverage: Primary
coverage plans provide coverage without
regard to any other insurance or coverage the
plan holder may have.
Secondary Coverage:
Secondary coverage plans require plan
holders to have primary coverage, and the
secondary coverage only covers those
expenses not already covered by the primary
coverage plan.
Benefits: The
amount payable by the insurance provider to a
claimant, assignee or beneficiary under each
policy.
Beneficiary: The
person or persons designated by the insured to
receive the proceeds of an insurance policy upon
the death of the insured.
In closing, it is obvious
that you have a lot to consider and understand
if you want to make sure of your coverage while
traveling. Take you time and ask
questions. One last resource to consider
is a useful Internet site for comparing some of
the major insurance plans is
http://www.tripinsurance.net
, it is operated by InsureMyTrip.com, which you
need to remember sells insurance. Remember, what
ever someone tells you is only as good as the
times your have spend confirming the information
by having it in writing. That can usually
only be found with the insurer itself, not a
verbal statement for a sales
representative......read that fine print.
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