Identifying the best expat medical insurance plan is a tough process that is only complicated by the excessive insurance terminology. You’re certainly not alone in occasionally feeling overwhelmed while searching for details on specific insurance policies. Fortunately, we’ve put together this extensive list of expatriate insurance terms that will come up again and again in your research.
Definition: Expatriate health insurance policies provide either worldwide or regional medical coverage to international citizens living outside of their home country.
Accident – an unexpected event that causes injury, that was not intentionally caused by the insured, and arises from causes outside of their control.
Acute Medical Condition – a medical condition that is sudden, severe, and often unexpected. Acute medical conditions can include anything from an asthma attack to a broken arm.
Act of Terrorism Coverage – international medical insurance coverage for injuries or illnesses that are the result of an act of terrorism. While conditions will vary from country to country, the following 4 conditions must be met for act of terrorism coverage to take effect for U.S citizens:
- The Injury or illness does not result from chemical, nuclear or biological weapons or events.
- You have no direct or indirect involvement in the act of terrorism.
- The act of terrorism is not in a country or location where the United States government has issued a travel advisory that has been in effect within the 6 months prior to your date of arrival.
- You have not unreasonably failed or refused to depart a country or location following the date an advisory to leave that country or location is issued by the United States government.
Alternative Therapies (Complimentary Therapies) – therapy and treatment that falls outside of traditional Western medicine or treatments. Examples include: acupuncture, meditation, and homeopathy.
Benefit Period – the period of time during which the insured receives compensation from their insurance company for medical purposes, and can vary from policy to policy. For example, one policy may state that your benefit period begins the day you are hospitalized for a serious illness and ends 30 days after you stop receiving treatment.
Casualty Insurance (Indemnity Insurance) – insurance coverage outside of life insurance or health insurance that primarily serves as liability coverage if the insured’s negligent acts or omissions result in an accident. For example, if you are found “at fault” for a car accident, casualty insurance could cover medical expenses of those involved in the accident and repair of damaged property.
Certificate of Creditable Coverage (CCC) – a certificate issued by an insurance company that provides proof of your insurance plan and dates of coverage.
Claims – the amount of money requested by an insured individual from an insurance company to cover the costs of insured medical expenses. Claims are typically made in the form of a written notification to the insurance company requesting payment for medical care that was received.
Comprehensive Medical Insurance – insurance plans that cover a wide range of expat health services including hospitalization, emergency services, maternity care, and much more.
Continuous Coverage – health insurance coverage that is not interrupted by a delay in timing from one policy ending and another starting.
Coverage Area – the geographical region where an insurance policy is in effect.
Covered Expenses – expenses that the insurance company agrees to cover based on the purchased insurance policy. A full list of covered expenses will appear in the Schedule of Benefits.
Covered Reasons – the specific situations and events that are covered by a specific insurance policy.
Coverage Maximums (Aggregate limits, or policy maximums) – most international insurance plans have a lifetime maximum, condition maximum, or annual maximum that will be listed under your policy benefits. Here is a breakdown of how each maximum works:
- Annual Maximum – Some policies have a maximum coverage that resets ever year at renewal. To give you an example, let’s say you have a medical emergency that costs $2 million but your plan has a $1.5 million annual maximum. The plan will only cover $1.5 million for that certificate period year. If the $2 million is incurred in the same policy year, then you will pay the remaining $500,000. At the renewal of your plan at the end of the year, the plan will again offer $1.5 million in coverage.
- Condition Maximum (Per Injury, or Per Illness Maximum) – the total amount that an insurance plan will pay per condition. As an example, let’s say you have a $100,000 coverage maximum per injury or illness on your plan. If you have an injury which requires hospitalization, physical therapy, and regular doctor follow-ups, the maximum amount the plan will cover for all of these related expenses is $100,000. If you have a new unrelated illness or injury, you would be entitled to coverage up to $100,000 for that condition.
- Lifetime Maximum – the maximum amount a plan will cover for each insured over the lifetime of the policy. Once the lifetime maximum has been paid, there are no more benefits covered under the policy. So, to give you an example, let’s say your plan has a $5 million lifetime maximum. In the first year, if you have $1 million in paid claims. In this case, the policy will only pay $4 million for eligible expenses for the remaining life of the policy. Once you meet the lifetime maximum, no further expenses are covered and you may need to seek a new insurance plan.
Death Benefit (Survivor Benefit) – the total compensation that is paid to the beneficiary of the life insurance plan when the insured passes away.
Deductible and Copays – typically the amount you pay out of pocket either before the coverage starts (deductible) or as a percentage of what the insurance plan covers (co-pay ro co-insurance). More: Deductible, Co-Insurance and Co-Pays.
Dependent – a spouse and/or children who are legally dependent on the insured for financial stability. In some cases, dependents will qualify for insurance coverage within the insured’s policy.
Earned Premium – the amount of total premiums collected by an insurance company that has been “earned” based on the elapsed time of the policy. For example, if your annual insurance premiums were $1,200, and you were 6 months through your policy, the insurance company’s earned premium would be $600, even if you paid the $1,200 up front.
Effective Date – the date at which an insurance policy becomes effective.
Elimination Period (Waiting Period) – the period of time between the insured’s accident and the arrival of benefit payments. For example, if you broke your leg in January and received your first benefit payment in February, the elimination period would be one month.
Epidemic – an outbreak of a contagious disease that spreads rapidly and affects many individuals in a community at the same time.
Evacuation Insurance – insurance covering expenses of transporting the insured back to their home country in the event of an emergency. Evacuation insurance can be broken down into three types:
- Medical Evacuation Insurance – insurance that provides for the transportation of the insured to another location if they cannot find adequate emergency treatment locally. For example, a doctor declares that it is a medical necessity for you to be transported to a neighboring country where doctors have proper equipment and expertise to treat your condition.
- Political Evacuation Insurance – insurance coverage that provides for transportation out of your host country in the event of a military coup, civil uprising, mass riots, political unrest, or being identified as a “persona non grata” (“person not appreciated”).
- Repatriation of Remains – insurance coverage that allows for a deceased insured member’s body to be transported back to their home country. While each policy will specifically define what is covered, typically this benefit covers preparation of remains to be transported, including air and/or ground transportation back to the principal residence. For example, if you were to pass away while abroad, your insurance provider would cover the cost of your body to be flown back to your home country, and driven to your family’s house.
Exclusions – cases under which an insurance provider does not provide coverage to the insured. For example, an insurance company may include an exclusion for car accidents if the insured is driving under the influence.
Expatriate Insurance – insurance policies designed to cover financial losses that expatriates face while living and working in a country other than their own.
Flexible Spending Account (FSA) – a benefit program offered by most organizations that allows you to set aside pre-tax income every month to be used for certain out-of-pocket medical expenses (also see HSA – add anchor link)
Floater Policy – insurance coverage for property that is moved from one place to another that is not included in standard policies in the new location.
Fulfillment Kit – the materials that are sent to a new policyholder at the beginning of their insurance coverage providing information about the plan, a certificate of coverage, information on how to file a claim, and contact information of the insurance company.
Grace Period – a period of time after an insurance premium payment is due during which the insured can fully enjoy the insurance coverage without incurring an additional fee. Grace periods can range from 24 hours to 30 days, and after their expiration, the insured will be required to pay an additional fee.
Hazard – any situation or condition that increases the chances of an insured loss occurring. For example, smoking is a hazard that increases your chance of lung cancer.
Health Savings Account (HSA) – a benefits program that is very similar to FSAs, in that employees can set aside pre-tax income to be used for medical expenses, with a few minor differences, such as the ability to roll over balances from one year to the next with HSAs.
High Deductible Health Plans (HDHP) – health insurance plans that have low premiums and high deductibles, relative to most other health insurance plans. In other words, HDHPs charge lower monthly rates, but typically provide less coverage in the event of a hospital visit or other medical expense.
Health Insurance Portability and Accountability Act (HIPAA) – a law passed by Congress in 1966 that mandates industry-wide standards for the protection of healthcare information, while also reducing healthcare fraud and abuse.
Hospital Indemnity – a budget included in some insurance plans (ex. Atlas Travel Medical Insurance) that covers expenses for items like meals and toiletries that you may be required to take on if you find yourself in a hospital for several weeks. Hospital indemnity benefits are not subject to a deductible or coinsurance, meaning the expenses are fully covered by insurance providers.
Inflation Protection – a feature of certain insurance policies whereby the value of benefits increases by a certain, pre-defined percentage during specific time periods to assure that insurance coverage grows at the same pace as inflation.
Insurance Provider Network – the grouping of hospitals, doctors, and other healthcare providers that the insured will receive the maximum insurance coverage from working with.
- Health Maintenance Organization (HMO) – an insurance provider plan that typically limits customers to receiving insurance coverage only when working with one specific network provider.
- Preferred Provider Organization (PPO, or Participating Provider Organization) – an organization of hospitals, doctors, and other health care providers who have agreed to provide healthcare at reduced rates to clients of a particular insurance provider. Healthcare providers who fall into your provider’s PPO are often referred to as “In-Network” providers, while healthcare providers outside of your insurance provider’s PPO are referred to as “Out of Network” providers, and will typically cost you much more than in-network providers.
Life Insurance – an insurance plan that pays the insured’s family in the event that the insured dies. Life insurance plans are found in two forms:
- Term Life Insurance – an insurance plan that covers a person for a specified period of time (days, weeks, years), but not for their whole life. It only pays benefits if the person dies during the time that the individual is covered for.
- Whole Life Insurance – an insurance plan that covers a person for their entire life. Whole life insurance plans pay benefits regardless of when the insured dies.
Lost Luggage Insurance (Baggage Insurance) – coverage for any checked or stored baggage, or personal items that are damaged, lost, or stolen during your travels. Lost luggage insurance usually included coverage for replacement costs of travel documents, and will occasionally include bag tracking.
Natural Disaster Insurance – medical coverage for any expenses that are a direct result of a natural disaster, which is defined as any event that has the capacity to cause great harm to property or individuals.
Out-of-Pocket Expense – the total amount that you will pay towards your medical expenses. These expenses typically come in the form of a copay, co-insurance, deductible, or some combination of the three.
- Co-Insurance – the shared cost of medical treatment between the insured and the insurance company. This shared cost is typically broken down by a certain percentage, like 80/20. In the instance of an 80/20 co-insurance, the insurance company will pay 80 percent of any medical bill, and the insured is responsible for the other 20 percent. It’s important to check out what percentage you will be expected to pay along with whether there is a maximum amount at which the insurance company will pay the remainder. For example, perhaps you find a plan that has an 80/20 co-insurance up to $5,000. This means that you are responsible for 20 percent of your expenses until you reach the $5,000 cap. Then, typically the insurance will pay 100 percent up to the benefit or policy maximum. Keep in mind that not all co-insurance will have a cap. While this is fine for smaller items such as a doctor visit for a cold, it can quickly add up when it comes to larger emergency situations.
- Copay – the set fee that you are required to pay when you use the plan. For example, if you have a $50 copay on doctors’ visits, you would be required to pay the first $50, and the insurance company would pay the rest. Keep in mind that, on top of a copay, many insurance providers also use coinsurance, which would increase your contribution for that same doctor’s visit.
- Deductible – the annual amount that you are required to pay out of pocket before your insurance company will pay any eligible expenses. For example, if you have a deductible of $1,000, your insurance company will not cover any medical expenses until you have spent $1,000 on medical expenses for the year.
Out-patient – a patient who receives medical treatment at a hospital or clinic, but is not admitted for an overnight stay.
Policy Year – the length of time from the effective start date of the policy to one year later, at the close of the policy. For example, if the effective date begins May 9, 2017, the policy year would end on May 9, 2018.
Pre-Certification – the process of checking in with your insurance company to ensure that you are covered before moving forward with any medical expenses. Pre-certification eliminates the possibility that you will need to cover the cost of the entire medical expense.
Pre-Existing Conditions – any injury or illness which, prior to the start of the insurance plan, manifested itself, exhibited symptoms, required medical treatment or medication, or for which a physician was consulted. The exact definition will vary from plan to plan, but the key idea remains the same. Pre-existing conditions will often not be covered under your insurance policy.
Premium – the amount that the insured must pay to their insurance provider in order to be insured. These payments may be paid as a lump sum, or in installments during the period of coverage.
Premiums Are Fully Earned – A policy that is non-refundable if canceled before the insurance certificate expires, or if there is a reduction in coverage due to the sale or loss of an item covered under the insurance policy.
Preventive Care (Wellness Benefits) – routine healthcare services intended to prevent illness and other health-related issues from developing in the first place. Some examples of preventive care include check-ups and counseling.
Quarantine – mandatory isolation or restrictions on where you can go, intended to stop a contagious disease from spreading.
Refund – a cash, credit or voucher for future travel that you receive from a travel agent, tour operator, airline, cruise line or other travel supplier, or a reimbursement you receive from your employer, another insurance company, a credit card issuer or any other entity.
Remote Transportation – insurance coverage for transportation related to medical issues that are not immediately life threatening, but are severe enough to result in permanent disability or death if not treated right away.
Return of Mortal Remains – Repatriation of Remains of a deceased individual to the insured’s home country.
Rider (Waiver) – a formal written statement from the insurance company to the insured amending and modifying coverage of the insurance plan. It could involve waiving coverage for a certain medical condition like cancer, hepatitis or adding coverage for such conditions.
Risk Class – a group of individuals that have similar characteristics (i.e. gender, race, medical history, etc.), which is used to determine the risk that the insurance provider must take on to provide coverage for an individual who falls under that group. The risk class that you fall under is largely used to determine your insurance premiums.
Schedule of Benefits (SOB) – a list of the benefits, and the amount of coverage provided in an insurance policy, usually one or two pages in length.
Subrogation – steps that a travel insurance company takes, after paying a claim, to collect from other available sources such as other insurance plans or travel suppliers.
Terrorism – criminal acts committed with the intent of causing death, serious bodily injury, or the capturing of hostages, with the goal to provide widespread terror in the general public or within a group of persons, or compel a government or international organization to commit, or abstain from committing, an act.
Trip Cancellation Insurance – insurance coverage that provides reimbursement for non-refundable trip payments and deposits in the event that the trip is canceled due to illness, death, or other specified unforeseen circumstances.
Trip Interruption Insurance – insurance coverage that will reimburse you for pre-paid, non-refundable travel expenses in the event that serious illness, death, airline strike, or other crises occur during your trip causing it to be canceled, interrupted, or delayed.
Underwriting – the process by which insurance agents review yours and your family’s existing medical records to determine whether or not you are eligible for a specific insurance plan. After the review process, the insurance company will either approve, deny or approve with a rider, which excludes certain conditions from the coverage.
Usual, Reasonable, and Customary Coverage (URC) – prices often range from one healthcare provider to another, so URC was set up by health insurance providers to protect themselves from additional costs. Usual, Reasonable and Customary Coverage gives individuals the option to choose more expensive healthcare providers, but states that the insurance company will only cover the individual to the maximum coverage amount based on the location and procedure, which is determined by the insurance company’s figures on the usual cost of the medical expense.
Waiting Period – a period of time that the insured must wait before some or all of the coverages offered in an insurance plan begin. In other words, if you break your arm during the waiting period, you would not be eligible to receive medical benefits.
While we can’t tell you which plan is right for you, this list of terms combined with our travel medical insurance reviews should leave you in good hands to find the best plan for your needs.
Did we miss anything? Probably not, but do your best to come up with any other expat insurance terms that you feel belong on this list, and send them to us via Twitter or Facebook. We’ll gladly add any relevant terms that you come up with.