Local Or International Health Insurance – Which Should I Choose?

The choice between International Private Medical Insurance (IPMI) and local Private Medical Insurance (PMI) should be driven by your personal situation as the benefits can be very different.

Pros and Cons of Local Private Health Insurance for Expats

Lower premiums are one of the major attractions of PMI.  Lower premiums are available as the coverage is restricted to getting treatment in one country.  In many countries expats do not have access to the full range of benefits of the state healthcare system.  In some countries you may have access provided you are paying in to the social security system or provided there is a reciprocal agreement between the host country and your home country.  This may be restricted or only cover part of the cost depending on the treatment required.  Before you move you should ensure that you know what will be available to you through the state healthcare system and on what terms.

Local private health insurance policies can provide you with options for treatment in the country in the private healthcare system, which often allow you to access treatment more quickly and sometimes a better standard of care.  There is also often top up insurance that enables you to cover the cost of any contributions that you have to make to any treatment received from the state system.

Premiums for some local health insurance plans are experienced based, ie the premium is based upon your medical history and claims experience with that insurer.  For a healthy individual, couple or family the initial premiums can be cheap.  However, if you have treatment for a serious injury or illness the premiums for the subsequent years can increase significantly making it far less attractive.  Against this international plans generally work on a pool rated premiums which means that they are based on the treatment costs of everyone in an age bracket and medical inflation rather than your individual claims in the year.

Another driver of lower local insurance premiums can be cover limits.  There may be limits on coverage for specific treatments or only cover a proportion of outpatient or inpatient costs.  You should check the coverage offered and ensure you know what costs you could have to pay yourself.

Local health insurance can also provide the benefit of extensive billing networks within the country which means that you do not have to pay for potentially expensive treatment upfront and then claim, but can gain approval for treatment and then have the bills settled directly by the insurer with the doctor and/or hospital.

The major factor for local PMI policies is that they cover you for treatment in that country and not elsewhere.  This means you have to rely on the quality of healthcare in the country where you are insured and cannot use alternative high quality facilities in other countries.  It also means that you will not be covered when travelling.  Although you can take out a travel policy and this may include emergency medical evacuation but this will enable your insurance company to return you to your home country and at that point their coverage will stop meaning you will be relying on local facilities and cover.

Pros and Cons of International Health Insurance

The major advantage for IPMI is that it is international.  This can be important if you travel frequently on business or on vacation.  You can take out travel insurance, but if you travel extensively the premium for international health insurance may be a better option.

IPMI can also be important if you expect to move frequently from one country to another as it allows you to move easily without having to take out a new policy and enables you to avoid additional costs due to any new pre-existing conditions.  Most policies are globally portable allowing you to continue uninterrupted coverage when you move.  One option to keep the costs down is to exclude coverage in the US where healthcare costs are very high.

Another advantage of IPMI is that you can take advantage of the best quality treatment available if you have a serious illness.  There will also generally be coverage for emergency medical evacuation and assistance including medical referrals, second opinions, tele-medicine consultations etc.  This can be very important if you are living or working in a country where top quality healthcare is not easily available even in the private sector.

Some international health plans have their own international billing networks, which can allow you to get treatment without having to fund any costs upfront.  All do allow you to get treatment outside their network, which allows you to ensure you have access to the best possible care.  This may, however, involve you in having to settle the bill initially and then claim from your insurance provider, potentially leading to large out-of-pocket expenses.

There are benefits to each type of insurance and there can be significant variations in cost and coverage when comparing one international policy with another or one local policy with another.  It is essential to decide what level of coverage you want and need and to ensure you consider all of the factors to ensure you are comparing like to like when making your decision on which policy to choose.