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.

A spokesperson for insurer CIGNA International Expatriate Benefits offers reassurance, saying that “help would kick in automatically for any medically necessary treatment required for those based in a location that experiences a natural or man-made disaster”.

This may include clinical advice, situation updates, point-of-contact information, and medical treatment or evacuation.

“Like most insurers, CIGNA won’t pay for preventative treatment or evacuations that weren’t medically necessary.”

Brokers and clients can never know for sure how their insurer will respond, until they make that emergency call.

Only a minority of insurers have the underwriting and logistical flexibility to offer a full range of international private medical cover in both disaster and war zones, says David Pryor, senior executive director at MediCare International.

“We are one of the few to offer genuine passive war risk protection,” he says. “Put simply, this means if a client is caught up in a war zone, we will offer cover for injury or sickness provided they are not active participants. If a client is injured and needs medical attention, this will be provided.”

In Libya, for example, the precise method of evacuation will depend on circumstances on the ground.

“If airlifting the client out of the country in a private air ambulance isn’t possible,” he says, “our international assistance provider will try to negotiate either a military airlift or a transfer to a military ship, then arrange onward passage to the nearest country where appropriate medical treatment is available.”

Pryor promises the same response regardless of whether man or nature is to blame.

“We covered clients caught up in the Japanese tsunami, where the local infrastructure was seriously damaged and medical facilities unavailable,” he says. “As with war zones, if civilian flights cannot be used for evacuations, we will turn to the military for help.”

CLIENT PREPAREDNESS

Clients have a duty to understand what protection their insurer offers.

“They must read policy documents carefully and understand the nature of their cover, as once caught in a war or natural disaster, it is too late,” Pryor says.

Now Health International covers treatment following a natural disaster, including evacuation and repatriation across all its products. If the policyholder has a critical life-threatening medical condition, its 24/7 emergency helpline will contract an emergency assistance service to evacuate urgent cases to the nearest medical facility, says business development director Tim Mutton.

“We also have local clinical teams on the ground in the UK, Dubai and Hong Kong, so we can tap into their knowledge to to provide the best possible care,” he explains.

Now Health will also cover innocent bystanders for injuries sustained from terrorism, war and illegal acts.

As the world becomes more turbulent, insurers are responding by beefing up their cover. Morgan Price International Healthcare’s individual and corporate GlobalCrisis plans now cover evacuation due to political or natural disasters, says managing director Jon Carpenter.

Morgan Price covers injuries or illnesses sustained during a natural disaster such as an earthquake or hurricane “as per a normal medical expenses”, Carpenter says. It will also cover innocent bystanders caught up in war and civil unrest.

But it sets a financial limit of £30,000 for the policyholder on terrorism claims. Again, brokers and their clients must be aware of all the nuances.

Steve Nelson, international sales advisor at April Medibroker, is surprised that insurers set limits on disaster cover.

“The chances of any given client getting caught up in a major disaster is actually very low,” he says. “It amazes me that some insurers potentially exclude some events, or limit cover to a set financial maximum.”

Few clients raise the question of how much cover they have in a disaster.

“But it is something I consider,” Nelson continues. “If I was choosing between two similarly-priced plans, with similar levels of cover, the quality of their emergency protection might just tip the balance.”

This isn’t just an issue for expats jetting off to the world’s trouble hotspots.

“You only have to think of the London or Madrid bombings to realise you can fall victim to a terrorist attack pretty much anywhere,” Nelson points out.

Nelson picks out insurer InterGlobal as going furthest in offering global security assistance, through global security specialists Red24.

ROUND THE CLOCK COVER

InterGlobal offers emergency evacuation and repatriation in life-threatening situations, according to Paul Weigall, head of sales and marketing.

“Anyone who finds themselves in a city full of protesters and security forces has the reassurance that a security specialist will come in to get them out if the mood turns ugly,” he says.

Red24 supplies 24/7 telephone advice on personal security in the world hotspots, including personalised pre-travel advisories, verbal briefings and on-ground assistance and evacuation.

“It has already helped six InterGlobal clients this year, in Egypt, Bahrain, Libya and Yemen. Our members know that help is there when they need it,” Weigall says, adding that Red24 offers full support in both natural and man-made disasters.

“Both are essential to give expatriates peace of mind, which is why we include red24 on all our plans,” he says.

Allianz Worldwide Care was busy looking after members during the Japanese earthquake and tsunami, says medical director Dr Ulrike Sucher.

“In a crisis, cover kicks in immediately,” Dr Sucher says. “Our first concern is to ensure the member gets the treatment they need. Where necessary, this may involve transportation by ambulance, admitting them to the closest appropriate hospital, or co-ordinating an evacuation or repatriation.”

An efficient, 24/7 multilingual helpline is a must for any insurer, she says. Allianz claims to answer 90% of emergency calls within 10 seconds.

“They speak to a member of the helpline team, rather than an automated response system,” Dr Sucher adds.

Allianz offers medical evacuation as standard across all its international plans, with repatriation an optional add-on.

Dr Sucher says expats working in remote areas, notably in the exploration and mining indusries, need to know their insurer can operate effectively even in the most remote locations.

“We have been recruiting regional medical managers in Eastern Europe, Africa, the Middle East and Latin America, to boost services in sparsely populated regions where access to medical care can be difficult,” she explains.

Even the most active insurers won’t cover everything. Most withdraw cover if the member ignores warnings from their government or embassy to avoid a particular country.

And no insurer offers treatment for illness or injury following a nuclear, chemical or biological spill or attack. That is the responsibility of government.

The chances of any individual expat getting caught up in a natural or man-made disaster are still relatively small. The consequences, however, can be huge. On paper, insurers all promise a slightly differing response. But it is what happens on the ground that really counts.

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