Understanding Travel Insurance

When we talk to groups of employees about their benefits coverage, one thing that pops up time after time is that employees are often unaware that their extended health care includes travel insurance!

Far too many employees have told us that they purchased travel insurance for a trip, as they either forgot or did not know that they and their family were adequately covered through their group insurance provider.

Do you already have emergency travel insurance in place?

Travel insurance is a common embedded feature of extended health insurance. Typically, it covers employees and their enrolled dependents (the key word here is “enrolled”- if your spouse or kids have waived this benefit line, they will not have travel coverage).

Generally speaking, travel insurance covers expenses relating to sudden, unexpected medical emergencies when traveling outside of your province and/or country of residence.

A claim through the travel insurance portion of the extended health care benefit could be as dramatic as an emergency room visit for a serious incident, or as simple as a forgotten prescription drug. Regardless, the cost of medical care in another country – most notoriously, in the United States- can be surprisingly expensive; you do not want to ever travel without ensuring you have coverage in place.

It’s more than just reimbursement for hospital bills

In addition to the obvious medical expenses one might incur for an illness or injury while travelling, there are usually additional embedded services included in a typical group travel plan such as:

• Help with finding qualified medical practitioners, wherever you are
• Help with lost baggage or stolen documents
• Help in contacting family, legal services, or consular assistance
• Assistance with transfer from one medical facility to another
• Assistance with the arrangement of repatriation of remains in the event of death
• Assistance with getting you home

Most importantly, the travel provider will coordinate the actual claim and will ensure the insurance carrier is properly notified, if applicable. Oftentimes, the provider will negotiate the cost of the medical expenses on your behalf, reducing the cost of the claim.

Most employee benefits insurance carriers use specialty travel insurance providers for this portion of their coverage. There are various reasons for this, including access to a worldwide network when it comes to handling claims situations.

Does the program provide enough coverage, or should I buy more coverage?

 Many travel insurance plans have very high limits; it is common to see $1M-$5M, usually expressed as a lifetime maximum per insured person. Some programs even have unlimited travel reimbursement. Within the policy, there may be limitations for specific items.

Most people feel this is an adequate amount of coverage for a typical vacation; however, if you still have concerns over the amounts, additional top-up coverage can be purchased.

Usually, there is no deductible

Travel insurance through a group benefit program usually comes with a $0 deductible; this means you are not out-of-pocket a certain amount before the coverage is applied to the expense.

Additionally, claims are what we refer to as ‘fully pooled.’ This means that the claims for emergency travel do not impact the claims experience for your benefit plan; while the Employer may see the dollar amount of the claim, the details and claimant will remain anonymous and the cost will not impact the renewal pricing calculation for the benefits program.

Are you travelling…or have you relocated?

Heading for an extended vacation? Be sure to check the travel duration limits on your program. It’s standard to see a 60-day travel duration included in a policy. What this means is that at day 61 (continuously away from place of residence) you are no longer insured under the travel insurance. Returning home for a single day will reset the duration count.

Have a lot of shorter trips planned? This is not a problem, as most plans do not quantify cumulative travel days, they define continuous travel.

Real Life Story

In one unfortunate incident, a member of a group plan we manage decided to extend his trip to Thailand multiple times but had failed to look into the details of the program in advance. He ended up in an emergency situation and was hospitalized for an extended period. The incident occurred on day 62 of his trip; the insurance carrier denied the claim as it was outside of their insured timeframe.

Some policies do allow for unlimited-duration travel, but this is rare. If you do plan to take an extended trip, make sure you understand your own coverage and if necessary, you purchase a top-up plan that starts when your other coverage ends.

Common emergency travel insurance clauses you need to understand

There are a few common clauses to be aware of, and to review within your own policy:

• Most extended healthcare emergency out-of-country travel plans do not cover trip cancellation or trip interruption; these are not considered ‘medical’ and can usually be purchased in conjunction with your flight or travel package or on a stand-alone basis.
• Most plans do not cover travel into locations with active travel advisories, into war zones, or emergencies arising from certain activities (participating in a riot, for example).
• Are you pregnant? Most policies do not cover pregnancy past 32 weeks. We have all heard stories of pregnant women giving birth outside their home country, unexpectedly early, and the high associated medical bills. A pre-term birth would be covered (along with the expenses for the newborn) up to 32 weeks, but it is not standard to have insurance beyond this mark.
• Lastly, and most importantly; does your policy contain a pre-existing conditions clause, and what is the exact wording around this? Earlier we stated travel medical policies cover “unexpected” medical expenses; pre-existing conditions, in general, are not considered to cause ‘unexpected’ medical situations, and therefore are often uninsured.

However, there are certain details to understand; it is possible for a pre-existing condition to be insured if it is stable and managed at the time you leave. For example, someone with high blood pressure or diabetes may still travel, and have an incident related to their pre-existing condition covered, if their medical emergency was unexpected because they were stable upon departure.

This is an area where it is essential to reach out to your provider in advance of your trip, declare your medical issues, and get their confirmation that you are covered.

Please note that while a pre-existing condition may not be covered, this does not mean you are not insured at all. For example, perhaps you have a pre-existing blood pressure condition that is not stable, as it is newly diagnosed. The insurance provider has confirmed to you that this would not be insured. If you decide to travel anyway, and you are in a car accident and break your leg, you would likely be insured for the visit for the broken leg, but not for anything relating to the blood pressure condition. The wording related to pre-existing conditions differs between insurers and understanding your own unique situation is crucial.

What to do if something happens while you’re traveling?

First of all, be proactive. The people you are traveling with should be aware of your insurance details, and vice versa. In a worst-case scenario, where someone needs emergency treatment, you may be required to provide proof of insurance to obtain treatment. In fact, many seasoned travelers wear medical bracelets that provide their basic information, including their travel insurance details!

Most employee benefits insurance carriers use specialty travel insurance providers for this portion of their coverage. There are many reasons for this, including access to a worldwide network when it comes to handling claims situations.

Open a claim as soon as possible. If you find yourself in a medical emergency, it’s very important to immediately provide your insurance information to the medical facility and to contact the insurance provider to open a claim. Wherever possible, avoid paying out-of-pocket even if it seems easier to just pay with a credit card, and worry about the claim later.

There are a couple of key reasons for this:

• Reduced costs; the costs the insurance provider will negotiate (depending on the country, but commonly for the US) are often far lower than what they will charge you as a ‘cash payor.’
• Simplified paperwork; if you return to Canada first, in most instances you need to file your claim first through provincial medical, and second through your travel provider. This is complex and can take months to resolve.
• Access to services; involving the third-party emergency travel provider will allow you to gain access to the many services listed above; for example, they may recommend you transfer to a different medical facility.

Travel with confidence

The reality is emergencies happen, but with a bit of simple preparation, you can have the best case scenario in a medical emergency. Understanding the scope of your coverage and having all necessary information readily available can make all the difference in the event of an emergency while traveling.

To learn more about travel insurance or to explore group or individual coverage options, contact us at info@immixgroup.ca or give us a call at (604) 688-5559, we are happy to help!