Before heading off on your first venture as an expat or for your next posting, please give some extra thought to protecting you and your family before you leave.
Having the right protection in place is an aspect of financial planning that is often overlooked when moving abroad. Insurance can become harder to source, more complicated and costly for that matter.
Adequate protection - or insurance cover - can provide peace of mind for you and your family. It means you can safeguard a desired quality of life for your loved ones and help avoid any financial hardship if long-term plans change through an accident, illness or loss of life.
Types of Cover
There are various types of personal protection policies available. In general, it's always important to ensure that the cover you have is adequate for your circumstances and your family members know the details of what you have in place.
The type of protection available includes:
Life insurance - often inexpensive, these policies are designed to pay a lump sum if you die and will often enable you to claim earlier if you are diagnosed with a terminal illness, enabling you to get your affairs in order.
The cost of the cover will be based on your age, smoker status, state of health, and occupation as well as how much cover you need and how long you want it to last.
Income protection insurance - this provides a replacement income if you are unable to work due to an accident, illness or disease. The benefit is set as a percentage of your salary and will come into payment after a waiting period, usually 13 or 26 weeks. Your premiums will depend on your age, occupation, benefit amount and waiting period.
Critical illness insurance - this will provide a lump sum payment if you are diagnosed with a serious illness or are permanently disabled.
Depending on the level of cover - which again can be altered if required - this could help to pay living expenses and the costs of moving if illness means you have to retire early.
Private health insurance - depending on your circumstances, for example your home and host country, you may be eligible for free or subsidised healthcare. The extent of this provision and the quality of local healthcare services are likely to be key factors in deciding whether to have private health cover or not. If healthcare is not state provided or subsidised, the costs of even minor or routine medical treatment can quickly mount up over time.
When arranging cover, check whether the whole family is covered for investigations, inpatient and outpatient fees, hospital stays, transport to a specialist unit and repatriation. Such policies can be very expensive, so you may wish to include a voluntary excess to keep premiums down.
If your circumstances change, such as a move to an area with higher risk, it may be that existing cover isn't valid or imply insufficient.
Equally, if you're relocating abroad with a company that provides insurance, read the small print carefully to check that the cover is adequate for your requirements and circumstances. If not, you may need to supplement it with your own policy.
Insurance provides vital protection against the impact of unexpected events and should be structured to reflect you and your family's needs and circumstances.
Having the right level of cover is vital, so get an insurance assessment carried out. Over-insurance means that you are spending more than you need to on premiums, whilst being under-insured will lead to a payout which is not sufficient for your circumstances.
Everybody has a set of individual circumstances that are clearly unique, and your cover will need to reflect this. For example, an accident in the family may result in higher medical costs for nonnationals depending on where you are, as will extras, such as an interpreter, if required.
For expats, it is likely to be important to arrange insurance policies that have international coverage. Always inform your insurance company if you move to a posting in a new country as the rate, level and type of cover may need adjusting. In effect, this could mean changing or updating your policy every time you move.
An easier solution could be to take out a portable policy that can move with you wherever you are in the world.
To find out more, call Bellwood Prestbury on +44 1242 584558 or visit www.bellwoodprestbury.com
Bellwood Prestbury Limited are authorised and regulated by the Financial Conduct Authority (reference number 224721)