Working overseas is an exciting opportunity for an employee. Companies also benefit from exposing their top talent to different markets, which broadens and develops their skills.
However, I was working recently with a client sending an employee to Dubai on secondment for two years, who discovered just how complicated sorting out international medical insurance policies can be.
This employee was married with children, however, as the children were teenagers and busy with exams ahead the family didn’t want to move with him and decided to stay in the UK. This is a pretty typical scenario these days with the husband travelling back and forth a few times a year during the time away.
My client was quite happy with this. In fact he thought it would be much easier organising for just one person to travel abroad rather than a family. While this might have been the case with some arrangements, it wasn’t with the medical insurance.
I had to remind him of the issue of trailing dependents – the family left behind. The employee going abroad moves onto a much more expensive international insurance policy, and the trailing dependents stay on the (cheaper) UK medical insurance policy.
It seems straightforward and logical enough doesn’t it?
Well it’s not. As the employee is no longer employed in the UK, he can’t have UK medical insurance, which means his dependents can’t go on his work policy.
The result is that they all have to go on the expensive international insurance policy. This isn’t ideal for the company picking up the tab, especially if they have many people working abroad with families back in the UK.
The daft thing here is that the dependents ended up with better medical cover than the CEO (in the UK) as the international medical insurance offers many more benefits. It hardly seems fair.
But what can companies do?
It’s probably best for them to try and find a solution with their provider. We recommend they negotiate with the UK insurer and see if there is a way round this to cover the dependents in the UK.
Having a benefits adviser to help with these negotiations can help as they will have a good relationship with the providers and will have managed many similar situations.
An adviser will also be able to help when the employee returns to the UK and needs to be put back on the UK medical insurance policy. Issues can sometimes arise here if they had a pre-existing condition.
As the policy has lapsed they will need to declare these conditions, which could mean there are restrictions placed on the policy. The worst case scenario could leave the employee worse off in terms of the level of cover than before he went. This isn’t ideal and will do little to foster company loyalty.
An advisor will be able to run through all the potential issues that might arise when sending employees abroad and help negotiate the best terms and policies to suit the individual circumstances.