Analysis: International PMI in a crisis

Harvey Jones reports on iPMI in disaster zones

From natural disasters such to tsunamis and earthquakes to man-maded crises like revolutions and wars, expats need to make sure they know what they are covered for and where, as Harvey Jones reports

From a safe distance, wars, revolutions and natural disasters exert a grim fascination. Close up, all is confusion. If you are an expat caught in the middle and urgently need medical attention, you need all the help you can get.

This is when that international private medical insurance (iPMI) policy you took out several years ago – from a safe distance – really counts. A little-noticed piece of small print can make the difference between being evacuated for urgent medical treatment, or being stranded in a disaster zone. In extreme cases, it could mean the difference between life and death.

The world seems to be suffering a plague of man-made and natural disasters. Think Tunisia, Egypt and Libya. Think Syria and Bahrain. Think the Japanese tsunami and the Fukushima nuclear accident. Think hurricanes and tornadoes in the US Midwest, killing hundreds. And that’s only this year.

Add to that the usual threat of wars and suicide bombers, and you can see why brokers and their expat clients are paying closer attention to their international PMI policy terms and conditions. Will it be there for them? The key is to find out before disaster strikes.

On one point, there is no confusion. If you are an active participant in the uproar, your insurer won’t want to know. Police, soldiers, military contractors, mercenaries, professional agitators and emergency rescue services all fail the “passive participant” test, and rule themselves off cover.

In practice, most policyholders will pass this test with flying colours. If you’re an expat, it isn’t your war or revolution, and it probably doesn’t feel like your natural or man-made disaster either.

CASE BY CASE BASIS

After that, definitions get more tricky. Most insurers say they will cover members caught up in events beyond their control, but to different degrees, and with different exclusions.

Tim Slee, sales director at Bupa International, says it “looks at these exceptional events on a case-by-case basis, even though it is normally standard for insurers to exclude treatment resulting from natural or man-made disasters.”

That’s not wholly reassuring, but in practice, Bupa International has been paying for treatment.

“In the Middle Eastern civil unrest, we covered our customers’ treatment, provided they didn't knowingly put themselves in danger. In Japan, we committed to paying any claims for treatment with a direct link to the earthquake, regardless of the policy."

Philip Wright, director, UK, at insurer DKV Globality, says that “in common with most other insurers”, it doesn’t cover risks related to war, civil unrest and terrorist attacks.

That doesn’t sound too reassuring either, but Wright adds a big exception to this general rule. DKV Globality will cover innocent bystanders who “get caught coincidently by the events in question, provided they are unable to recognise the peril in advance in a timely manner or avoid the dangerous situation in a reasonable way”.

Since most sane expats will take all reasonable steps to escape or avoid a recognised peril, can they assume they will be covered? Maybe.

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