What? Me? Worry?

monkeyOne of our biggest challenges before departure on our multi-year world journey was trying to figure out what we would do for medical insurance. Before we left we both had jobs with full benefits including medical and dental. Our insurance policies expired when we quit and we had to figure out how we would insure ourselves against the worst while traveling.

A good portion of our trip is through the developing world. Quality of medical treatment and cost of services here vary widely from place to place. Most major cities have several world class “designer” hospitals serving foreign patients with everything from emergency medical care to medical tourism, the strange development that prompts people to plan a two week holiday in Thailand to get a root canal and then recover on the beach. On average, medical expenses here are cheaper and that fact is enough to keep many of the travelers we meet uninsured. This route was not for us. Insurance is a personal decision so I am not going to weigh the pros and cons in this article, I am just going to detail the results of my research and tell you why we opted for the plan we did.

Secondary Insurance

A quick googling of international traveler’s medical insurance will bring up loads of cheap options. Most of these plans focus on trip cancellation (they reimburse you for the cost of your cruise if you get in a car accident on the way to the dock). They often also contain medical benefits but the benefits are limited to life threatening conditions or situations in which you will be caused serious and irreparable harm if not treated. The monetary caps on benefits are also far too low to cover anything very serious. These plans are meant to be purchased on top of existing medical insurance coverage. Many domestic plans will have exclusions for international medical expenses and these plans fill that niche by providing treatment until you can be sent home and covered by your primary insurance. All of these plans also have very strict limits on policy length and renewals. The maximum period of coverage is usually less than 6 months after which a new policy would need to be purchased and the whole nightmare of pre-existing conditions reset. Under some policies you are not even allowed to purchase a new plan.

In a lot of situations these policies work (i.e. if you already have medical insurance at home and are taking a short trip). That is why they are so popular. In our situation, however, they were all wrong. We needed a decent level of benefits to cover the worst case scenario and we needed complete coverage of catastrophic and not-so catastrophic but potentially costly medical problems. If you think secondary coverage may suit you, one popular option is World Nomad. Base policies start at $258 for 6 months and include up to $100,000 of emergency medical coverage. They have kind of a hip and flashy “young” website, please read all of the information carefully before buying.

Full Primary Coverage

If World Nomad represents the bare bones budget traveler’s medical insurance then HTH International is the caviar of the market. The HTH Global Citizen Health Plan is a full on medical plan with complete coverage of preventative care and emergency care that is renewable and carries a lifetime maximum of $5 million per person. The HTH plan reads just like most standard PPOs in the States with the exception that it is valid for use anywhere in the world. Not surprisingly it also carries a similar premium which for most unemployed budget travelers is simply unaffordable. When I found the HTH plan I was excited but after realizing that the cost of medical insurance would double the cost of my trip I had to look elsewhere. One thing that I did like about the HTH plan was that it included 100% post-deductible coverage for international expenses and the option of including an American PPO from Aetna as well. This plan would be perfect for professionals who spend part of the year in different places. Just be sure you’re ready for the cost. If you add the option of including the domestic Aetna PPO the premium doubles!

Finding the Right Balance

After loads of research and the help of a professional health insurance consultant I found Peterson International’s Worldwide Major Medical Plan. It is basically a stripped down version of the HTH plan. The Peterson plan covers any medically necessary expense up to a $5 million lifetime maximum and most importantly it is valid for one year and renewable for up to five years. The plan is geared toward people who are out of the country for all or most of the year.  To be eligible you must be out of the country for at least 5 months. The plan is not as comprehensive as the HTH plan in that it doesn’t cover preventative care, but it has a much lower threshold for covering medical expenses when compared to the secondary plans like World Nomad. It also has several high deductible options which we were able to balance with our willingness to pay for the premium and end up with an affordable (though certainly not cheap) plan. Like the HTH plan, Peterson also offers an option to include domestic coverage for double the premium. We know we will be out of the country all year so we opted to go without.

Sports Riders

Most medical plans have specific exclusions for certain sports and if like us you plan to spend the bulk of your trip doing these sports it is crucial that you make sure you will be covered. On most of the plans I came across rock climbing was specifically excluded from coverage. Bike touring, it appears, is not extreme enough for exclusion though check with your specific plan if this is what you’re looking to do. With Peterson we had to fill out a climbing questionnaire detailing the number of years we had been climbing and whether we ever had an accident before. The underwriters used this to determine how much to raise our premium to cover the risk of injuring ourselves while climbing. It’s tough to say how much the premium went up, but I think it was about 40%. On top of that, while we have a lifetime benefit of $5 million, the benefit for climbing is only $250,000.

Finding Information

When I researched and purchased our plans I found that very little information was out there and it was considerably hard to find. If you know of any other plans that you use or recommend please let me know. Kyle and I will be looking to renew or switch come February 2011.

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