This article was prompted by a question this week from a prospective client as to why not use business travel insurance to cover myself on a 3 year international assignment? It is a lot cheaper than expatriate health insurance.
It is a good question and prompted me to explain the differences between the two type of policies .I’ll respond in two articles;
- Corporate Business travel, and
- International Expatriate Health Insurance
There are important differences between business travel insurance and international expatriate medical insurance which is reflected in both benefits and premiums.
Travel insurance basically covers any problems or mishaps you may encounter while traveling like lost baggage or last minute changes to plane tickets or hotel cancellations, medical emergencies and emergency medical evacuation and repatriation.
As opposed to travel insurance, which is for short time travel, expatriate health insurance policies are designed to replicate the health system in your home country for the duration of your international assignment.
Corporate travel policies in Australia are all very similar and premiums are extremely competitive.
Do not let cost be your deciding factor when purchasing business travel insurance to cover unexpected problems or unexpected medical expenses. Accidents and emergencies are much more expensive.
Without appropriate insurance, you are personally liable for covering any medical expenses incurred during your trip and the cost could be exorbitant. Hospitals and providers of medical services overseas are not benevolent societies and they will extract their pound of flesh.
By ensuring you are properly covered by travel or international health insurance you can spend more time enjoying your life and travels and less time worried about the costs of unexpected accidents and illnesses so let’s look at the two types of insurances that will provide you with appropriate cover
Corporate business travel insurance (1)
Corporate business travel insurance policies are designed to satisfy an employer’s need of providing protection for employees who are exposed to additional risks by travelling on behalf of the company.
HR “Duty of Care” legal requirements
▪ An employer is obliged to insure, so far as reasonably practicable, the health, safety and welfare of its employees, and other persons.
▪ Failure to do so can result in the liability of the employer, its directors and/or senior managers
Benefits included under a corporate business travel insurance policy are payable in addition to any other group or individual plan and in most cases satisfies legislative compliance (OH&S and common Law) to protect a company’s “Duty of Care”.
Who is covered under a corporate business travel policy?
Eligibility is usually extended to include all executives, employees, and accompanying dependents, of the company and/or designated classes of employees on business travel.
Business only coverage is activated once the employee leaves his/her regular premises of employment or their residence on company business and continues until they return to either, whichever occurs first.
Separately, coverage for Officers of the company and key employees can be extended to full business and leisure travel. This broadens the coverage to include vacations, travelling to and from work, and while at home.
Scope of Cover
Corporate business travel policies are designed to provide cover against the unexpected only whilst travelling on company business. They provide benefits that relate to problems likely to be experienced by a business traveler during a business trip.
The 21st century global workforce lends itself not only to political unrest and terrorism exposures but also to geographical catastrophe or endemic diseases.
Not all corporate travel policies cover these exposures. Some policies have very onerous medical conditions exclusions and other exclusions such as pre-existing conditions, war & terrorism, political risk, (civil unrest, hostilities, rebellion etc.), HIV/AIDS, pregnancy and age limits, to mention but a few.
Corporate business travel definition of medical expenses
The definition of medical benefits under corporate business travel policies, usually unlimited, make this benefit unsuitable for expatriates on long term assignments.
The definition of medical expenses varies between insurers but basically medical expenses are payable only in case of an unexpected accidental injury or illness that occurs whilst on a journey* (trip).
Injury means a bodily injury to an insured person resulting from an accident caused by violent, external and visible means and occurring whilst on a journey (trip).
Sickness means sickness or disease of the insured person occurring whilst on a journey (trip).
*Journey or trip means the period of individual cover as described in a policy schedule but is normally for trips up to a maximum of 180 days. Trips exceeding 180 days’ duration void the policy. (Some insurers still have a 90-day trip limit).