creating Insurance Plan for Expat Employees

How to Create an International Health Insurance Plan for Expat Employees

One of the most challenging aspects of human resources is sending employees abroad for long-term work assignments. Global mobility managers are a specialized subset of human relations and global benefits teams. Part of a duty of care for international employers is creating insurance plan for expat employees strategy and policy for expatriate employees.

Global health insurance coverage for your expat employees requires careful consideration of various factors to ensure their health and well-being while adhering to legal and regulatory requirements. Sourcing international group insurance quotes from the market must be completed by a highly experienced global benefits brokerage with extensive experience, knowledge and contacts. Expat Financial, a division of TFG Global, is just such an independent resource.

We have compiled a step-by-step guide on developing an effective global health insurance strategy for your organization. Note that some of the item orders can be interchanged. What is essential is that all the following steps are completed if you are sending employees abroad:

Here are Steps to Create an International Health Insurance Plan for Expat Employees:

Step 1: Assess Expat Employee Health Requirements

It makes sense to first consider your expatriate employees’ health needs through surveys, interviews, and consultations. Consider factors like their age, pre-existing medical conditions, family size, and the countries they will be residing in. This assessment will help you tailor the health insurance plan to meet their specific requirements.

Step 2: Appoint an International Benefits Specialist Brokerage

While it may seem easier to work with your existing domestic benefits plan broker in your home country, he or she likely has little or no experience, contacts, or knowledge of global benefit plans.

Collaborating with an expat group insurance expert can help ensure your global mobility team gets tailored coverage for international employees, addressing unique needs like cross-border healthcare and legal compliance. For the same reason you would choose an international tax specialist, you should work with an expat benefits plan specialist. Their expertise minimizes risks, streamlines administrative processes, and provides peace of mind. While it may seem like you are adding another insurance contact, you are actually fostering a smoother experience for both employers and expatriate staff in a globalized work environment.

Note that it doesn’t cost your firm anything to appoint an expat group insurance brokerage like ours because we are paid by the insurer you choose and do not charge consulting fees. We can also obtain lower rates from the insurance market than your company can as we have a very large block of clients and expat premiums.

Step 3: Review Domestic Health Coverage & Use As A Guide Only

Domestic health plans are often not as comprehensive as the global health plans provided to expatriate employees. Your domestic health plan can be a great guide to make sure the employees your firm is sending abroad are kept whole, but more than likely, if you wish to attract and retain expat talent, your global rewards team should secure a more comprehensive policy for ex-pats with a small or zero deductible plan.

International Major Medical Insurance

Step 4: Examine Local Regulatory Considerations for Expat Destinations

Companies should familiarize themselves with the health insurance regulations in the home country of your organization and especially the countries where expatriate employees will be working. It is crucial that you get a global health plan that will comply with the mandatory health insurance requirements of each country, if applicable, and ensure that the chosen insurance plan meets or exceeds those standards. Examples of such countries are Australia, the USA and the UAE.

Step 5: Review Your Company’s Global Health Benefit Requirements

With the help of a specialist global benefits advisor, your HR and global rewards team should review your company’s global health benefit requirements. It makes sense to start by assessing the diverse healthcare needs of employees across different regions and also globally. Evaluate local regulations, cultural considerations, and healthcare infrastructures.

Yes, your firm will need to balance coverage, compliance and cost-effectiveness. We do not recommend you put expatriates on a local benefit plan if possible – for a variety of reasons noted on our website. Two quick reasons would be that local plans are not made for ex-pats and do not provide portable or global coverage.

A comprehensive review ensures a well-aligned, resilient global health benefit plan, promoting employee well-being and satisfaction while addressing the complexities of an international workforce, which are not the same as your home office or locations abroad.

What if the Company Has Only One Expat Employee?

Note that if your organization only has one expat employee, it will need to source an individual global health policy, and the coverage will be subject to medical underwriting. A group program will almost always have superior rates and coverage, and if there are enough employees, the policy will cover pre-existing medical conditions. We offer several individual health plans for companies with few or only one expat employee.

Step 6: Submit an RFP to the Market and Review Rates and Coverage

This is, of course, an expected requirement. Most of our clients prefer two or three global insurance companies to quote on the global benefit and global health insurance risk for their expat staff, and some prefer even more, but in reality, our large multinational clients prefer to work with a very large, respected and well-known expat insurer, of which there really are very few. There are lots of players in the market for global benefit plans, but in reality, only a small few are really up to the task.

An international insurance broker will submit employee census data with relevant risk profiles and client requirements. The insurers then return with quotes, which are compared by rates and benefits. It makes sense to have all the insurance companies quote on the same census and benefits; otherwise, comparisons are useless.

Mozambique Insurance

Step 7: Choose a Comprehensive Health Insurance Plan and Balance Rates

While placing your expat employees on a bare-bones global health and benefit plan with high deductibles and coinsurance is tempting, your HR team should remember that attracting and retaining expat talent is critical to your organization’s global success. The cost of a failed expat assignment can be in the hundreds of thousands, so select a global health insurance provider that offers comprehensive coverage across the countries where your expatriate employees are located.

As your advisor to source a plan that includes medical, dental, and vision coverage, as well as emergency medical evacuation and repatriation benefits, Make sure the global benefit plan covers mental health, maternity, wellness and virtual telehealth. Finally, a global health plan should cover pre-existing and chronic medical conditions. We have seen some companies unable to hire key employees because their sub-par medical plan did not cover pre-existing medical conditions.

We also recommend asking your broker if a coverage benchmark is available for your industry’s expat population or what level of benefits are required.

Global Rewards directors always need to balance the quality of health insurance coverage with the cost to the organization. An experienced broker can help assess the plan’s cost-effectiveness and negotiate with insurance providers for competitive rates. Consider factors like deductibles, co-payments, and premium sharing arrangements.

Also, make sure you pick an insurance provider which has a very large and robust medical network in the regions where your employees are located. Employees prefer to be able to show a card at a hospital and receive treatment, but note if outside of the network; the employee can contact the insurer and request a guarantee of payment.

Step 7: Provide Clear Policy Guidelines & Communicate Policy

When working with a global health insurance broker, it can often make sense for a client to create a detailed policy document outlining the health insurance coverage, exclusions, claims procedures, and contact information for support. Global mobility managers should make sure all expatriate employees understand the policy and how to access medical services in their host countries. We often arrange for an employee webinar to discuss the coverage, how to claim, what is covered and much more.

Most international group insurance plans will provide a benefits summary for the employees along with a claim card with contact information. We recommend our clients get a plan that will provide an online portal and smartphone app for submitting and tracking claims. Here are some other recommendations:

  • Make sure dependents are covered. If you are sending an employee abroad with or without their spouse and kids, it is critical that the dependents are also covered abroad or back home (trailing dependents).
  • Complete a pre-assignment questionnaire. Some insurance providers will give access to a pre-assignment questionnaire that can help everyone get ahead of any ongoing health matters that could be impacted by a work assignment abroad.
  • Ensure international employees understand the coverage, limitations, and procedures for making claims. Provide ongoing support and resources to address any questions or concerns related to their health insurance benefits.

Step 8: Consider Wellness & Preventive Care

Over the past decade, many benefits and HR managers have realized the importance of having an international benefit plan that includes wellness and preventative care programs.

Promote wellness and preventive care among expatriate employees by offering health screenings, vaccinations, and access to wellness programs. Investing in these global preventive measures can reduce healthcare costs in the long run and contribute to the overall well-being of your workforce. Some insurers have excellent wellness coverage and programs, including exercise and mental health initiatives. We also recommend clients have an international employment assistance program, as these have been shown to reduce employee turnover and benefit their health.

Group evacuation insurance

Step 9: Incorporate Emergency Assistance Services

Choosing an international health insurance plan that provides 24/7 emergency assistance services. This includes access to a multilingual helpline, medical advice, and coordination of emergency medical services when needed. Medical evacuation coverage is vital if your company sends employees to destinations with substandard medical services and facilities. Most global medical plans will include evacuation and repatriation coverage as an option or include it in the medical rates.

Note that medical evacuations have to be coordinated and approved by the insurance company or their contracted assistance provider and generally include transport to the nearest center of medical excellence, not where the employee or employer wants the employee to be evacuated.

Step 10: Implementation and Monitoring of Global Benefit Plans

We recommend that clients allow for at least one month to implement a global benefits and global health insurance program for expatriate employees. Many insurers can implement a program and bind coverage with a moment’s notice, but the more time allowed will make sure the process and coverage is put in place properly. It takes time to input the employee data, set up policy and premiums processes, get ID cards etc…, so ideally, two months’ notice is preferable, especially if your company is changing from one insurer to another. We recommend an employee meeting to explain the global benefit plan to the employees.

Regularly review the performance of the global health insurance coverage and strategy. Note that most expat benefit plans are fully pooled, so your claims will have a minimal impact on rates, but most insurers will provide some information on where employees are claiming and for what services. A global rewards team should welcome employee feedback and monitor satisfaction levels. Be prepared to adjust the plan based on changing employee needs and market conditions if necessary.

We do not recommend going back to the market more than every three or four years, especially if the global health benefits plan is running well. Providing feedback to the insurer can help improve coverage and service level.  The insurer should also provide ongoing administration and premium support along with local compliance requirements and updates.

Some Final Thoughts for Global Mobility Executives

Creating a global health insurance strategy for expatriate employees involves assessing and monitoring global expat needs and requirements on an ongoing basis with the help and assistance of a partnership between the client, brokerage and insurer. By following the above steps, your human resources team can ensure that your expatriate employees have access to quality healthcare coverage regardless of location.

The global benefits landscape is ever-changing, and staying updated on industry trends and regulatory developments is essential. Remain agile and be ready to adapt the benefits strategy when required to meet the evolving needs of your expatriate workforce.