Venezuelan Currency Problems Impact on Expat Insurers
There has been a steep devaluation of the Venezuelan Bolivar in recent months. Official exchange rates defined by organizations like Dow Jones – that are used in the claims reimbursement process by many expatriate group insurance companies, no longer reflect market exchange rates. Continuing to do so could lead to reimbursing claims for amounts that are disproportionate to the actual market value of the expenses.
Some international health insurance firms will now use the SICAD II (Complimentary System of Foreign Currency Acquirement) exchange rate for reimbursing claims incurred in Venezuelan Bolivars. The Central Bank of Venezuela introduced this exchange rate in March 2014 as part of the government’s plan to help stabilize its shaky currency.
It is thought to be more in line with the actual market value of the Venezuelan Bolivar than any other index. It is critical that expatriates be covered by an insurance company which can settle claims in major currencies.
TFG Global Insurance Solutions Ltd. and its expat division Expat Financial will continue to monitor the situation and how it will impact expatriates who reside in Venezuela and other countries with currencies which are volatile. More information on international health insurance, including quotes, can be obtained at Expat Financial.