Travel Insurance Top-Ups Can Be Money Savers—But You Must Know the Rules

Topping up your existing out-of-country travel insurance coverage, be it with an employee, pension, group, or Public Service Health Care-type plan, can save you money and provide good travel coverage. But you need to pay attention to the conditions and “overlap” limitations.

First of all, understand that not all plans are compatible with each other, and whenever you top up you should make it clear to the selling agent what you are doing and which plan you are topping up. Do not assume that because you are covered for 30 days in Plan One, Plan Two will automatically pick up your coverage on day 31.

For example, if you have a tummy ache on day 28 and three days later you are admitted to a hospital with an abdominal emergency, Plan Two will likely consider that a pre-existing condition (because your illness began before Plan Two’s coverage date) and will not cover you. Plan One may say your hospitalization didn’t occur until after their 30-day coverage period, and you end up in no-man’s land. Insurers usually try to sort out such overlap problems between themselves, but it’s not comfortable being stuck in between. Also, if you are in less than perfect health and take medications or regularly see a physician for certain symptoms or a condition under treatment, you must meet the pre-existing condition requirements of the top-up plan if you expect coverage on or after day 31. Those requirements may not be the same in the two plans.

There are also some primary (earlier) plans that do not allows top-ups, or secondary (later) plans that do not top up certain primary plans, so you must make sure your top-ups are compatible. It’s always best, where possible, to top up with a plan offered by the same insurer as your earlier plan.

Also, primary group plans don’t always offer the same benefits as your top-ups, and their benefit limits are not usually as high as are dedicated travel insurance plans. So you need to know what your group plan covers and that may not be easy because group plans don’t always provide you with specific contracts precisely listing benefits and exclusions. Be persistent. Ask your plan administrators to show you what is covered and what is excluded.

Many primary group plans also have lifetime limits on your medical benefits. If, for example, that’s only $100,000, you could draw that down very quickly with only one or two visits to a foreign hospital. That would leave you with nothing for the rest of your life. Ask about those limits and make sure you know what you have in the “bank.”

Sometimes it may even make economic sense to forego drawing on the primary group plan and take out travel insurance from day one of your trip. If you are healthy and your daily rate for travel insurance is relatively low, you may find that a simpler and safer option. Do the math. But make no assumptions. Make sure you know the details of what both plans cover, what their limitations and exclusions are, and then make your choice.

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