International business travel is so commonplace that it's easyto overlook potential medical risks. However, high-profile newscoverage of natural disasters, terror attacks and diseases such asEbola, although extremely rare, have many companies taking a secondlook at international medical insurance.

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“These types of events definitely make travelers think aboutthings other than the usual accident and sickness coveragetypically found in travel insurance plans,” says Lynne Peters,insurance product manager for InsureMyTrip in Warwick, RhodeIsland. “It has raised awareness, which is a good thing for thetraveler. They should be aware of the different issues that couldaffect their travel plans.”

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InsureMyTrip partners with 28 U.S. and two Canadian providers tooffer nearly 400 travel-related products.

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The U.S. Travel Insurance Association (UStiA) in Rockville,Maryland, reports increased awareness and sales.

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“Recent news stories do appear to have raised awareness of theneed for medical insurance for international travel,” says CarolWalsh, executive director of the association. “In 2014, more than152 million Americans were covered by travel protection through avariety of travel-related protection and emergency serviceproducts. The number of people covered has increased 17.6 percentfrom 2012, while the number of plans sold increased by 15.2percent.

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“Programs that include trip cancellation/interruption benefitsaccount for more than 85 percent of the travel protection productspurchased in 2014. Travel and medical evacuation products accountfor 7 percent of the programs sold.”

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Although demand for international medical insurance remainsrelatively low, it appears to be growing.

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“Travel insurance used to be a pretty limited product,” saysAndrew Bard, vice president of sales for HCC Medical InsuranceServices in Indianapolis. “But in the last decade, the industry hasevolved and diversified, out of circumstance and economicnecessity, stretching to include everything from basic medicalcoverage to medical and political evacuations and naturaldisaster-related complications.”

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Defining terms

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International medical insurance falls under the much largerumbrella of travel insurance, which includes such coverage as tripcancellation, rental car collision, hazardous activities, andaccidental death and dismemberment.

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“International group medical plans typically cover either ashort-term need or more permanent situations,” Bard explains.“Short-term needs consist of travel medical group plans and blankettravel medical plans. Long-term and more permanent situationsrequire an employer-sponsored health plan that acts much like aU.S.-style group health plan.

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“These plans typically cover pre-existing conditions, maternityand wellness; most plans qualify as creditable coverage once anemployee returns to the United States. Premiums come from theemployer and can be paid monthly, quarterly, semi-annually orannually.”

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Walsh lists the conditions covered in a typical travel medicalplan:

  • Medical costs in case of accident or illness.

  • Emergency dental may be included.

  • Emergency transportation (medical evacuation and ambulance) iscovered.

  • Repatriation coverage will ensure the body is properlytransported home or to a funeral home nearby if an individual dieson a trip.

  • It may include some term life benefits or accidental death anddismemberment coverage.

  • It also may include some trip insurance benefits, such ascoverage for lost or delayed baggage.

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International travel insurance is still a relatively newproduct, but the number of providers is growing. Although mostpolicies are sold online, many companies also work through brokers.Most products resemble domestic coverage, but several new wrinkles,such as international preferred provider organizations (PPOs), arebeing introduced.

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“A common objection an employer has is that many of theinternational plans are reimbursement plans,” Bard says. “Thismeans members are expected to pay the provider up front and submititemized bills for reimbursement. There is a current trend amongproviders to create worldwide networks and direct-pay agreementsglobally. Some carriers have a solidified network, some arebuilding their network and some carriers have yet to beginbuilding. It is fair to say these global PPOs are in an infancystage.”

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In addition, he says, carriers now offer enhanced coverageoptions to draw in new members that include coverage for terrorism,natural disasters, political evacuation, hazardous sports, wellnessprograms, dental and vision programs, as well as plans with nodeductible and no co-insurance.

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Weighing risks vs. rewards

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Employees of large, especially multinational, businesses mayregularly travel internationally. In small businesses, it may be arare occurrence, with an executive attending a trade meeting orworking with a new overseas client. Regardless of the situation,the role of the human resources department is to evaluate the needfor international medical insurance, and then find the right policyat the best price.

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“Each company and HR professional needs to assess the specificrisks for their company and determine the plan and policy that isright for their needs,” Walsh says. “Compare companies, policycoverage, benefits and prices to find out what is included and whatisn't when deciding what coverage is right for your company.”

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This starts with contacting the company's broker to see what theexisting policy does and does not cover.

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“Most U.S. health insurance plans don't provide any coverageoverseas,” Bard says. “Those that do aren't equipped to deal withserious events, such as emergency medical evacuations, languagebarriers or the fact that many providers overseas demand payment upfront.”

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Next, evaluate who from the company will be travelling.

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“Know your traveler,” Bard says. “Are there pre-existing medicalconditions? How long will the traveler be away from the UnitedStates? Does the existing U.S. medical plan cover issues thathappen outside of the country? Depending on the visa needed fortravel to a foreign country, what are the requirements? The mostcommon mistake is thinking that the company's benefits package isgood enough while traveling outside the United States.”

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Then it's time to ask the broker for recommendations or startshopping online. The Centers for Disease Control and Preventionsuggests asking about a host of key topics, including exclusionsfor treating exacerbations of pre-existing medical conditions andthe company's policy for out-of-network services.

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As with any insurance plan, it comes down to an evaluation ofrisk versus reward.

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“Travel insurance is designed for the traveler who wantsprotection when they travel outside their home medical insurancecoverage network,” Walsh says. “This is important, because expensesassociated with a medical emergency can easily approach $100,000for a serious medical problem.

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“Our best advice is to consider the individual or company'sspecific risks, and determine the specific coverage that is desiredand then determine the plan and policy that is right for theirneeds.”

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How much?

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After determining the need and finding a reliable carrier, thefinal step is determining the amount of coverage needed and howmuch it will cost.

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“It really does depend on the destination and potential risk,”Peters says. “For people traveling to a low-risk area, having aminimum coverage of $50,000 to $100,000 for emergency medicalcoverage, and $250,000 in $500,000 in emergency medical evacuationmight make the traveler comfortable.

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“But when traveling to a high-risk area, you really should havea high level of emergency medical and emergency medical evacuationcoverage, possibly as much as $500,000 in emergency accident andsickness coverage and from $1 million up to an unlimited amount ofemergency medical evacuation. But really, it all depends on thecomfort level of the traveler.”

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The price of the policy is based on the length of the trip, thedestination and the age of the policyholder, according to theUStiA. Expect to pay between 4 percent and 8 percent of the overallcost of the trip.

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HR professionals will be familiar with many of the big-namecarriers that offer international medical insurance. Membership inthe UStiA also is a good sign.

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“Purchasing from a UStiA member company is your assurance that acompany has met high industry standards, including participation inthe association's Code of Ethical Conduct,” Walsh says.

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If a staff member is travelling for pleasure, think twice beforepurchasing insurance offered by a tour operator or cruise line. Thecoverage may be worthless if the company goes bankrupt, accordingto the American Society of Travel Agents. The association alsorecommends against buying from a travel agent, who may promote thepolicy that pays the highest commission.

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Unless a business has assurance that its domestic policy will bein full effect overseas, the best advice may be the tagline fromthe old American Express commercial: “Don't leave home withoutit.”

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“A common mistake is having a question and not asking it,” Walshsays. “If you're not sure if something is covered or not, or havequestions about exclusions or limitations, ask the company.

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“Like any purchase, it's important to do your homework — comparecompanies, policy coverage, benefits and prices to find out what isincluded and what isn't, when deciding what coverage is right foryour company.”

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