Expatriate Insurance or Travel Insurance: Which Is Right for Your Long-Term Trip Abroad?
Travel insurance is generally best for short-term trips. For long-term stays abroad, expatriate insurance is generally preferable.
You’re off on a trip—a long one. Perhaps you’ve taken a job abroad or you've set off on an extended globetrotting journey. What sort of insurance—especially with respect to health coverage—is best? To help you answer that question, we will review your main options.
Standard Travel Insurance
Travel insurance is designed with international trips of up to one or two years in mind. They can be suitable for long-term journeys or short family vacations. Typical coverage includes:
- Illnesses and medical emergencies
- Emergency evacuation
- Short-term medical care
Policies can also optionally cover:
Travel insurance does not, however, cover you for long-term medical care. The idea behind this is that, if such care is required, you will return to America to receive it (see these 4 Signs You Need Long-Term Care Insurance). You would be covered for short-term care or an emergency that ended with long-term care, but the long-term care itself would require a separate health insurance policy that covers you back home. Even if your travel insurance provides health coverage, then, it is important to keep your stateside health insurance in force while you're away.
When choosing a travel insurance policy, be sure to read the fine print and make sure you understand how much treatment can be provided before you must return home to receive long-term care. In case of a serious illness or injury that leaves you incapable of traveling, you are typically covered until you are deemed "medically able" to travel (see 6 Things You Should Know About Travel Insurance to learn more).
Expatriate insurance is designed for people who will be living abroad long-term, usually for a minimum of one year and often longer. The coverage is akin to what is covered by stateside health insurance plans and typically (but not always) includes:
- Routine medical and dental care
- Prescription medication
- Maternity care
- Extended care in hospitals
- Diagnostics, such as blood tests and x-rays
- Coverage for pre-existing and chronic conditions
- Medical evacuation to the United States for care that is unavailable in the country where you were injured or became ill
In some cases, expatriate insurance companies rely on networks of doctors and hospitals. As is the case with such systems in America, you will get the best coverage if you obtain care within the network.
Be sure to read carefully what the basic coverage offers, and what is available as "add-ons" to the basic coverage. "Basic coverage" will vary from policy to policy and company to company, so it's important to know exactly what you're getting.
Also find out whether the policy covers you while you are in America. Many of these policies will not provide coverage within the States, some provide coverage for a limited period before or after your travels, and few provide unlimited coverage while in the States. Also note that deductibles, co-pays, and other restrictions that do not apply abroad may apply withing the United States (to understand these different features of your policy, see All the Ways You Pay: Premiums, Deductibles, Co-Pays, and Coinsurance).
While you are abroad, you are unlikely to need to maintain a stateside health insurance policy, but the limited stateside coverage provided by expatriate policies might need supplementing. For instance, if you travel back home regularly for business or to visit family, you should ensure that you have protection.
Local Healthcare Plans
If you expect to reside in a single country while you are abroad and do not expect to travel at all, a local healthcare plan in that country is another option.
These are generally not recommended, since you won't be covered and it may be difficult to obtain treatment if you are injured or become ill if you end up deciding to travel out of the country in which you're residing. This is especially the case if you reside in a less-developed country, but can be an issue anywhere.
If you will be abroad as part of your work for a large, international corporation, your employer will likely know the ropes and provide a policy with appropriate coverage.
Nevertheless, it doesn’t hurt to discuss the coverage with a broker or agent who has experience in international coverage and, at a minimum, with a knowledgeable person within the corporation. If you are working for a smaller outfit that has not had much experience with international travel, it is best to get your own advice in addition to whatever your employer has to say.
Wrapping It Up
Traveling or residing abroad can make obtaining healthcare coverage more complicated than it usually is, but don’t let this scare you off of your travel plans. In general, for short-term trips, travel insurance is best; for long-term residency abroad, expatriate plans are what you want. In either case, quality coverage is available at reasonable cost, and is just a discussion or two away with a qualified broker or agent (see Medical Concierge and Insurance Broker: What's the Difference? for advice on finding the right insurance professional).