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Planning an Overseas Trip?

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Make sure you’re protected in case of an unexpected healthcare need.

MoneySmart By Grace S. Yung
MoneySmart
By Grace S. Yung

Any type of unexpected illness or accident is frightening. But when you’re thousands of miles from home, the uncertainty and expense of seeking emergency treatment can be overwhelming. Even if you already have health insurance, you could be at risk of incurring substantial expenses if you or a loved one needs healthcare while traveling abroad.

Take, for instance, the family whose father became ill while visiting Argentina, resulting in a $100,000 cost to fly him back to the U.S., or the daughter who had to ask for donations to fly her mother’s remains home after she passed away while traveling abroad.

Although these situations may sound extreme, they’re not unusual, and it’s often a scramble to find the assistance and funds that are needed. This is why it’s a good idea to consider buying travel insurance.

How Travel Insurance Works

Travel insurance can provide coverage for hospital admissions and other medical expenses in foreign countries, as well as physician-coordinated emergency evacuation and transportation back home for medical reasons.

You should consider travel insurance:

• if you have health insurance coverage that has a high deductible. For example, if you are self-employed and/or you have coverage via the Affordable Care Act, you may have a plan that requires you to pay a large sum out-of-pocket before the policy’s benefits kick in. If this is the case, check your policy to see what it covers if you’re traveling abroad.
• if you will be traveling with small children who could require medical treatment due to an accident or serious illness.
• if you are covered by Original Medicare (Medicare Part A and Part B). In general, Medicare won’t cover healthcare or prescription medications you receive while traveling outside the U.S. In fact, even in the rare circumstances where Medicare might pay, foreign hospitals are not required to file Medicare claims, so you could find yourself wading through a lot of red tape without any assurance that your bills will be covered.

The bottom line here is that if you would never think of going without health insurance here at home, why would you take the risk when you’re away?

Where to Find Travel Insurance Coverage

Travel insurance can be purchased online or through a local insurance or travel agent. If you’re 65 or older and you’re covered by Medicare Part A and B, you may be able to obtain at least some amount of travel coverage through a Medicare Supplement insurance policy.

For example, Medicare Supplement insurance Plans C, D, F, G, M, and N all provide emergency coverage when you travel outside the U.S. Typically, these “Medigap” plans will cover you if the emergency began during the first 60 days of your trip—and if Medicare doesn’t otherwise cover the care.

With these plans, the insurance company typically pays 80 percent of billed charges for certain medically necessary emergency care (after you have paid the $250 deductible), with a lifetime coverage limit of $50,000.

Like most types of insurance, travel policies come in many forms and cover different things. So what should you look for when evaluating them?

In terms of “must-have” features, you should make sure the travel-insurance policy covers medical expenses, transportation costs to get you back home, trip cancellations due to an accident or illness, travel delays due to bad weather or mechanical issues with your mode of transportation, lost or stolen luggage, and personal liability (such as accidental bodily injury or property loss suffered by another individual).

Other features that some travel-insurance plans cover include emergency dental coverage; accident coverage (this can be particularly important if you’re taking an adventurous trip that includes hiking, scuba diving, skiing, or other potentially risky activities); replacement of lost or stolen cash or traveler’s checks; medical costs due to an act of terrorism; and additional expenses due to the loss of your passport.

If you have a preexisting medical condition, be sure it’s covered by your travel insurance. In some cases, a policyholder has 14 days from the start of the trip to purchase a plan to cover these potential needs.

Before deciding on a travel-insurance plan, be sure that you carefully read the policy’s Outline of Coverage, which you should also take with you on your trip. That way you will be able to verify your coverage and follow the insurance carrier’s instructions for filing claims.

How to Take the Next Step

Since any type of travel emergency can quickly devastate your finances, travel insurance can be a great way to protect yourself and/or your partner. When choosing travel-insurance coverage, be sure to talk with a financial professional about your specific needs, travel plans, and travel time frames. Ideally, your advisor should be someone who works with the LGBT community and can ensure that your specific travel-insurance coverage needs are met.

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Grace S. Yung

Grace S. Yung, CFP, is a certified financial planner practitioner with experience in helping domestic partners plan their finances since 1994. She is a principal at Midtown Financial LLC in Houston and was recognized as a “Five-Star Wealth Manager” in the September 2017 issue of Texas Monthly.
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