Accidental Medical Expenses Abroad, 3 Things to Know Before Traveling

learn the difference between stop-loss overseas medical expense coverage and travel insurance rider coverage. standardized stop-loss policies don't cover medical expenses abroad, but there may be exceptions for first-generation stop-loss policyholders.

when Minsoo Kim went to the emergency room with a sudden stomach ache while traveling in Europe last summer, he was surprised to receive a bill for more than KRW 2 million for a simple examination and test. He thought he was covered because he had accidental loss insurance, but his insurer told him that medical expenses incurred abroad were not covered.

nowadays, traveling abroad has become commonplace, and many people assume that as long as they have accidental death and dismemberment insurance, they will not have to worry about medical expenses anywhere. but the reality is different. today, we'll explain the relationship between stop-loss insurance and international medical expense coverage, and what you need to know before traveling.

standardized stop-loss policies don't cover medical expenses abroad

standardized stop-loss policies sold after October 2009 do not cover medical expenses incurred abroad. If you look closely at the terms of your stop-loss policy, you'll see that coverage is limited to domestic medical facilities. This means that even if you have an expensive stop-loss policy, you'll be responsible for the full cost of your medical expenses abroad.

this is because the basic design of accidental death and dismemberment insurance is based on the domestic health insurance system, where the coverage ratio varies depending on whether or not you have health insurance, but overseas medical facilities are outside of this system and are not covered.

why do you need a travel insurance overseas medical expense rider?

to cover medical expenses incurred abroad, you'll need to purchase a separate travel insurance policy. Specifically, an overseas medical expense rider provides comprehensive coverage for medical bills, hospitalization, medications, and more due to illness or injury while traveling.

in the United States, an appendectomy can cost upwards of $30,000, and Europe also has high medical bills for foreigners. in most countries, foreigners are not covered by local health insurance, so you'll have to pay out of pocket, especially in countries where healthcare has been privatized.

travel insurance can be purchased up until the day before you leave, and the premiums are affordable if you're traveling for a short period of time. Unexpected accidents and illnesses can happen even on a trip of a few days, so it's always a good idea to purchase travel insurance before you go abroad.

there is one caveat, though. having a domestic medical expense coverage rider on your travel insurance policy doesn't mean you'll be able to double up on medical expenses after you return home, as each insurer will split the actual losses you incur based on the principle of proportional compensation.

special exclusions for first-generation stop-loss policyholders

if you had a stop-loss policy before September 2009, be sure to check your policy rules. some pre-standardization first-generation stop-loss policies may also cover medical expenses incurred abroad.

these policies will pay about 40 percent of your medical expenses abroad as if you were not covered by health insurance. this is a great way to get reimbursed for a significant portion, if not all, of your expenses.

if you have a first-generation stop-loss policy, make sure you have all the relevant documentation, such as medical certificates, receipts, and prescriptions, when you go abroad, because you'll need them to file a claim when you return home.

it's important to note that coverage can vary from policyholder to policyholder, so if your policy says that you're covered if you're treated at a hospital or clinic in your home country, you may not be covered for treatment abroad. It's best to check your policy carefully or contact your insurer directly.

what to expect when filing a claim after treatment abroad

when you receive medical treatment abroad and file a claim with your travel insurance, you'll need a few documents. you'll need a medical certificate, preferably in English, and detailed, itemized receipts for your treatment. You'll also need to include your prescriptions and receipts for your medications so you can claim for them as well.

after you return home, it's a good idea to file a claim with your insurance company as soon as possible. most insurers require you to file a claim within three years of the date of the incident, but the more time that passes, the more complicated the documentation requests and proof can become.

it's always a good idea to understand what you're covered for, and to make sure you have adequate travel insurance when traveling abroad, especially if you're traveling for an extended period of time, are elderly, or have a pre-existing condition.

frequently asked questions

Q1. If I only have physical damage insurance, will it cover medical expenses abroad?

no. Standardized stop-loss policies sold after October 2009 only cover domestic medical expenses. to cover medical expenses abroad, you'll need to purchase a separate travel insurance policy.

Q2. How do I check my first-generation stop-loss policy?

first-generation accidental death and dismemberment insurance policies purchased before September 2009 are eligible. you can check your policy dates and terms or contact your insurer directly to find out exactly when you were covered.

Q3. If I have both travel insurance and accidental death and dismemberment insurance, am I covered twice?

medical expenses incurred abroad can only be covered by travel insurance. if you receive additional medical treatment in your country after returning home, each insurer will share the losses according to the principle of proportional compensation, so double compensation is not possible.

Q4. When can I purchase travel insurance?

most travel insurance policies can be purchased up to the day before departure. however, each insurer may have different rules, so it's best to buy well in advance.

Q5. What documents should I pack for medical treatment abroad?

you should bring a medical certificate in English, detailed receipts for treatment, prescriptions, and receipts for medications. these are essential documents for insurance claims, so make sure to keep them.

the bottom line

accidental loss insurance does not cover medical expenses abroad, and you should always have travel insurance when traveling.

if you're planning a trip abroad, make sure to check your coverage and purchase travel insurance if you need it - it could save you from unexpected medical expenses. if you found this article helpful, please share your experience in the comments.