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Is your company meeting it’s “Duty of Care” obligations to it’s expat employees?

An Expat Employer’s Fiduciary Duty of Care for Expats

Sending employees abroad is a big financial, moral and legal responsibility for expatriate employers. Many professionals are constantly talking about the importance of providing a “duty of care” for expat employees sent to work abroad and even when sending employees for long or short term assignments and meetings. What does this mean? In my view, it basically means that the global employer needs to take all steps required to safeguard and prepare for the safety, well being and health of their employees. It is the fiduciary responsibility that experienced global mobility managers realize is so important regardless of the legal implications – its a moral responsibility. This is especially true today in a world where conflict and terrorism can strike almost anywhere. It makes sense to plan for what your employees may face abroad.

Employers Should Examine Their Obligations

It is critical that expat employers meet the overseas obligations of their employees, whom can find themselves in new and sometimes hazardous regions and countries that they may not be adequately prepared for. It is vital that HR managers carefully read over the employment contracts to make sure that the company is fulfilling its obligations to their employees. This means that employers should examine their employees’ needs and country location to prepare for contingencies. Our firm has access to very detailed country information that can provide global mobility managers with key insights for each destination, including security reports. 

Expat Employers Should Identify Risks

When your HR department is sending employees overseas, it often make sense to ID risk and adopt prevention measures and train employees. You can’t hope that nothing terrible will happen. You can’t account for all the risks that your employees and their dependents may face working or traveling abroad, but you can take steps now to plan and mitigate those situations. We recently had an employer who finally agreed to implement a comprehensive kidnap and ransom program with security evacuation and in the first year of the policy it was used after a group of employers were kidnapped by bandits. Luckily with the assistance of on-sight negotiators paid by the insurer and a ransom being negotiated, the hostages were released unharmed.

heart rate monitor and doctors in an emergency room

Inadequate Insurance Coverage for Expats

A recent report from Cigna mentioned that 50% of expatriate employees feel that their expat employers are not meeting their duty of care requirements for the global assignments that they are on. Furthermore, three quarters felt that they did not have sufficient funds to support their healthcare expenses. We often run into situations where new and even existing expat employers will send employees and their dependents (spouse & children) on overseas assignments with inadequate planning and especially insurance coverage. With more an more companies and non-profit organizations sending employees for short or long term assignments to high risk countries such as Iraq & Afghanistan, the requirement to provide a secure and safe work location is vital. Our firm has extensive experience in working with employers operating in such areas where civil strife and conflict are commonplace.

Common Expat Insurance Deficiencies We Have Observed

Here are a list of deficiencies that we often encounter:

  • No coverage for pre-existing medical conditions
  • No cover for pregnancy or a 12 month waiting period
  • Many expat employers have no disability coverage in place
  • Coverage is placed with insurers that simply can’t meet the needs of expats
  • Lack of adequate evacuation cover that is not fully insured
  • No war or terrorism coverage for employees residing in high risk countries
  • Inability of expats to find medical centers that can receive medical payment directly from the insurer

What Expat Insurance Coverage Can Help Your Company Meet It’s Duty of Care?

A group expat plan that is properly designed and sourced can provide a high level of global insurance coverage that will fully meet the duty of care for your expatriate workforce stationed around the world. We are able to source the following coverage for our group expatriate clients:

It is critical that your global mobility department fully commit to the duty of care philosophy and provide global coverage for your employees that exceeds what is required no matter where they are posted. Our firm can source plans for individuals and groups. For more information on the global benefit plans that we can offer your international workers, please contact us today.

Is your company employing American expats?

Is Your Company Aware of the Risks for American Expats?

Is your organization or multinational company employing American expats? Are you aware that most American expatriates will want to seek medical treatment in the USA if possible, especially for serious conditions? If so, are you aware of the significant costs associated with medical care in the USA?

We have sources some excellent risk prediction guidelines for expatriate claims in the USA or for American expats who more often than not wish to obtain medical care back in their home country. These medical costs can easily run into the hundreds of thousands of dollars and if not covered, more often than not the employer will have to cover.

Our firm is extremely experienced in sourcing global medical coverage for firms that employ American expatriates and also covering their dependents who are located with the overseas employee or residing back in the USA – otherwise known as trailing dependents. Unfortunately, we often see extremely inadequate medical plans provided for American employees that will often restrict medical care in the States or not cover the USA at all. Even worse, some expat employers will have group insurance plans that don’t cover pre-existing medical conditions for these American expats.

international health insurance for chronic conditions

Annual Medical Costs in the USA

Our firm has gathered a detailed “Risk Prediction Guideline for Expat Claims in the USA” that we are able to share to corporate clients that employ expatriates in the USA or have American expat employees working overseas. Note that the costs can vary widely depending on the state, city, medical provider and of course the nature and severity of the claim. Here are some sample annual medical costs from the report:

Rheumatoid Arthritis: $40,000 to $60,000

Bone Cancer:  $100,000 to $250,000

Lymphoma: $80,000 to $150,000

Diabetes: $30,000 to $40,000

Valve Replacement: $60,000 or more

Transplants: Over $200,000 in most circumstances

Back Disorders: Over $50,000

Complicated Pregnancy & Birth: Easily over $500,000

So, as you can see from the sample medical costs in US dollars, the annual medical treatment costs in the United States can often run in the hundreds of thousands and for many clients one claim can easily exceed the entire medical premium that they would be paying for a group of American expatriates. Many expats or their family members will often suffer from one of these conditions or may in the future. Many expat employers are not aware of the fine print on their global medical coverage are are being served by domestic focused brokers with limited or no understanding of expatriate medical coverage.

Next Step for Expat Employers

Thus, it makes sense to cover these risks with a global benefit plan that will provide superior coverage for your entire expat population, especially American expats or foreign employees located in the USA. To learn more, contact our firm to discuss your global expatriate insurance needs as it pays to work with a specialist firm. You can also visit our corporate expat insurance page for additional details. If our firm is engaged as your expat insurance broker, we would be pleased to share our valuable risk report.