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Traveling and living in a foreign country can be exciting and rewarding, but it can also prove challenging and expensive, especially when sickness or injury occurs and medical services or worse, medical evacuation is needed. Medical costs have risen dramatically worldwide and the quality and costs of both routine and emergency medical care can also vary tremendously from one country to the next. Consequently, many world travelers purchase supplementary international medical insurance or travel insurance in order to avoid the potentially staggering financial costs that could result from serious sickness or injury in a foreign country. 
Get An Insurance License

When planning a short or long term trip abroad it is best to find out directly from your primary home-country health care provider (i.e., health insurance, HMO, ministry of health), whether and to what extent, and under what circumstances you are covered for medical expenses (emergency and routine) incurred while traveling abroad. Many people are surprised to discover that their health care provider offers little or no protection or reimbursement for the costs of any type of medical treatment received in a foreign country. Where this is the case, purchasing international travel insurance is a prudent option. 

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 benefitsas 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.

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.