Travel Me Continuing Education for
Financial Service Professionals
Travel Medical Insurance: Managing Medical Risk at Home and Abroad
e 2014: A Comprehensive CE Review
Travel Medical Insurance: Managing Medical Risk at Home and Abroad
Copyright 2015 CLIFE Inc. All rights reserved. Any reproduction of parts or all of this course and its contents by any means electronic or mechanical is prohibited.
The information in this course is provided for educational purposes only; it should not be construed or interpreted as providing advice. Readers should always seek guidance from their principals and compliance experts in regards to informing themselves and others about details of the products they sell and other considerations of their business.
We welcome all feedback and suggestions for additions to the course. Please send your comments to info@clifece.ca.
CLIFE INC. 1595 Sixteenth Avenue Suite 301 Richmond Hill, ON L4B 3N9 www.clifece.ca
This course provides continuing education credits upon satisfactory completion of an online test. Please see the website for details or email info@clifece.ca.
Contents Introduction
4
Travel and Risk
6
The Need for Travel Medical Insurance
11
The Risk of Underinsuring
16
Travel Medical Insurance Providers
18
Basics of Coverage and Process for Use
26
Comparing Travel Medical Insurance Policies
30
Travel Medical Insurance Challenges
32
Underwriting
35
Pre-existing Conditions, Stability, and Disclosure
37
The Issues of Coverage
41
Premiums Can Be Controlled
56
Medical Tourism
58
Claim Denied!
61
Conclusion
64
Introduction -
Health care costs are covered in Canada through provincial health plans for Canadian citizens, permanent residents, landed immigrants, and those registered as Indians under the Indian Act.
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When Canadians leave their home province to travel to another province or another country, they must acquire a private health insurance policy to pay for emergency health care needed while away from home, or be prepared to fund such expenses personally.
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Such private health insurance is typically called “travel insurance.”
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The term, “travel insurance” causes confusion among consumers because it is used to describe two very different forms of insurance: o Travel insurance is insurance that covers interruptions in travel plans, for instance if a flight is cancelled and the connection to a cruise vacation is missed. The out-of-pocket losses of the insured will be reimbursed.
This form of insurance manages the financial risks of travel caused by missed connections or lost luggage. The total financial risk can be quite accurately predetermined and accommodated in an insurance policy.
o Travel insurance is also accident and sickness (A&S) insurance that covers emergency medical care, including dental services, needed when the insured is out of province and/or out of country.
This form of insurance manages the financial risk of health care costs when illness or injury occurs while traveling. Insurance policies for this form of insurance must accommodate all the combinations and permutations of what can go medically wrong, where, and when based on the health of the insured at the time of travel. The total financial risk cannot be predetermined; costs
incurred, especially when traveling to the US, can be large and ongoing. -
This Course focuses on the A&S form of “travel insurance.� To be clear that we are talking about medical care when away from home, we are going to always specify that travel insurance in this Course is travel medical.
Travel and Risk -
By its very definition travel is about a journey, typically abroad and for a period of time. It takes many forms: from strapping on a backpack to unimaginably deluxe accommodations and accoutrements. Because travel involves leaving the familiar behind, risk is immediately introduced into the travel experience because of the element of the unknown.
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Travel medical risk is experienced by: o Those who have had medical conditions in the past that recur during the period of travel; o Those who have medical conditions at the time they travel; o Those who develop medical conditions as a result of travel.
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The final category is the group most easily served by travel medical insurance. However, it is the preceding two groups who have the greatest need for medical travel insurance since they run the greatest risk of needing care since they are going to be a “repeat offender�. They have pre-existing conditions: that is medical conditions that are in place before travel occurs. o Insurers attempt to quantify the risk of pre-existing conditions through underwriting, exclusions, and premiums. However, many individuals seeking insurance fail to appreciate their own medical condition.
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Many factors must be taken into consideration when assessing potential medical risk.
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Medical risk can be experienced as a result of: o Prior health conditions reasserting themselves (pre-existing conditions); o New health conditions developing during travel (i.e., heart attack or food poisoning) o Bad luck/fate (something unpredictable happens such as a broken leg);
o Risk-taking behaviour, such as rock climbing, bungee jumping; o Weather events (tornado, tsunami, or flood) o Political or other circumstances or upheaval in the country of countries being visited or planned for visit. Travel Advisories Manage Political Risk •
The Canadian government issues travel advisories for all
countries based on four levels of risk associated with travel. Agents and those who sell travel medical insurance should become knowledgeable about geographic “hot spots” and the alerts issued by Canada’s Department of Foreign Affairs, Trade, and Development (DFATD). •
A travel alert may also be issued for a region of a country,
which is distinct from that for the country as a whole. •
Travel alerts are issued at any time due to local events,
and Canadian medical insurance specialists and travellers should keep themselves aware of new alerts and advisories. •
This is one aspect of the travel medical insurance puzzle
that can be fairly accurately assessed beforehand, and the risk associated with the destination factored into the policy. • 1.
Travel alerts are issued at four levels: The minimum risk level is “Exercise normal security precautions”
and will not affect a travel insurance policy. 2.
Exercise High Degree of Caution. This means travellers should
exercise a high degree of caution and be vigilant at all times. 3. 4.
Avoid non-essential travel.
Avoid all travel.
•
If a level 3 or 4 travel alert is issued prior to the effective
date of coverage, benefits may be limited or invalidated. •
If such warnings are issued after the coverage date,
benefits may be retained by the traveller is expected to leave the country of region as quickly as possible. •
Travellers are encouraged to check the travel advisory
site at: http://travel.gc.ca/travelling/advisories prior to travel, and if any doubts exist as to safety and insurance, check with the issuer of the policy.
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