While last year's hot topic was the economic climate, 2010 could almost be about international private medical insurance (IPMI). Never before has there been so much focus on the product from providers and the trade press alike. Everyone seems to be talking about it.

It is great that the enthusiasm for this previously niche product is spreading. For many years now IPMI experts have discussed the merits of the product, yet it has never had the mass appeal that its domestic counterpart enjoys.

While the domestic private medical insurance market has been challenging, IPMI has remained buoyant - despite a global recession. The good news is that the future continues to look bright, as recent surveys predict that overseas assignments will increase, and the amount of ex-pats returning to the UK in 2010 will be 7% lower than in 2009. Moreover, Aviva's ‘Semi-Gration' study of UK workers aged 18 to 30 found that nearly six in ten people (56%) now believe there are better prospects abroad, with over half (54%) saying they are considering a stay in another country.

Despite these compelling statistics, for one reason or another many intermediaries have shied away from the IPMI market. This could be due to its perceived complexities. While there is no doubt that health systems vary considerably across the world, as an industry we are constantly responding to challenges as legislation changes. Advisers should let providers worry about this.

It is our job as providers to ensure that the products and services we are offering meet the clients' changing needs - leaving the adviser to focus on building your portfolio.

With the sales method and underwriting approaches very similar to those of domestic health insurance, entering the IPMI market may be simpler than many would think. What is more, it could be an easier sale. Where domestic private medical insurance is a product people choose to purchase as an alternative to the State system, or an employee perk, in many countries, having private medical insurance is a mandatory requirement for those needing a work visa.

Moreover, it is a potentially lucrative market, as commission levels paid on international policies are often higher than the adviser would receive on their domestic equivalents.

With many companies globalising for the first time or expanding an existing international presence, a growing number of employers are facing the challenges of managing an internationally mobile workforce. This is becoming increasingly complex as new industry hot spots emerge, with different cultures, languages, tax systems, legislation and healthcare provision. And, just because a country's economy is flourishing does not guarantee that it will have a health system to match. China is a prime example of such a country.

A daunting process

Being re-located thousands of miles away from home can be a very daunting process that can often leave employees feeling anxious and isolated. Many assignments fail for just this reason, and ensuring that clients have the best benefit structure and support in place from their employees, can help improve the chance of a successful relocation.

Aviva's ‘semi-gration research' found that looking after their health is one of the key concerns employees have when moving abroad. A quarter (25%) say the NHS is one of the things they would miss most, while almost two thirds (64%) believe the UK has superior state health benefits over other countries.

Wherever they are in the world, employees want the reassurance that they can access quality medical treatment whenever, and wherever, they need it. And, where the treatment is not available in the country they are living, they need to know that where necessary, they will be evacuated to the nearest country where treatment is available.

As with any sale, communication is key to selecting the right product. It is important to work with clients to find out as much information as possible about the employee's destination. Just remember that advisers do not need to know everything.

Small steps

Choose a provider that is willing to work with you to offer you as much, or as little, support as you need. For those entering the market for the first time, take small steps. Look to the existing book of business first - many could be surprised to learn how many of their clients have employees based abroad. Moreover, advisers may uncover clients who are not offering their employees the appropriate protection, giving them the opportunity to demonstrate the value their expertise brings.

Worryingly, a recent study from PMI Global suggests that one in five companies that send employees abroad for six months or more fail to provide them with international health insurance. Similarly, research conducted by Aviva, showed that over one third (34%) of young workers considering moving abroad would not consider it important to take out additional medical insurance.

Q&A:

Are people entitled to the same state health provision as the UK if they move abroad?
No not at all. State medical provision varies from country to country and in the case of the US and Canada, region to region. Moreover, due to the rising burden of state health costs, an increasing number of countries are introducing legislation to ensure that expats have private medical insurance before they can be issued with a work visa. The UAE is a prime example.

Employers therefore need to thoroughly research the health support available and supplement it through an international medical insurance policy where appropriate.

How much health cover does the EHIC card offer if people are moving abroad?
The amount of cover is dependent on the country they are living in. The card is valid in all 27 member states of the EU and in the majority of cases, UK citizens will have the same access to the state system as locals of that country, although they may need to pay in advance and then apply for reimbursement. It is worth remembering that the cover received may be less than they are used to receiving in the UK.

For those planning on working, the card covers UK nationals for up to one year, but they will also need a completed A1 form to show they are still paying tax and NI in the UK to cover this (employers should arrange for this). This can be extended for up to two years in case their stay lasts longer than originally expected but they will need to reapply for both the card and the A1 to be eligible.

Would standard travel insurance cover employees' health needs for a short-term assignment?
It depends what you mean by short-term, but travel insurance generally only provides cover for a defined period of time. Aviva's annual multi-trip travel insurance policy for example offers cover for stays up to a maximum duration of 120 days.

Looking at health specifically, standard travel insurance policies generally only cover medical emergency treatment following an accident or illness during the trip Everyday medical expenses such as prescriptions, GP visits and non-emergency medical treatment is not usually covered, leaving employees unprotected.

What do you need to consider when selling an international PMI scheme?

Advisers should look to:

Obtain country information which clarifies the local conditions including tax, social security legislation, healthcare provision and employee expectations. If you are not an international expert, draw upon the expertise of insurers like Aviva for this information.
Tailor benefits to suit different local conditions. Do not just choose the cheapest offering, look for a product that offers you the flexibility to tailor benefits to meet your clients' specific needs, and to complement the health provision available in the country they will be based in.
Understand whether the company can add the person to an existing UK health scheme (to pool the risk), or whether a stand-alone policy is a more appropriate option.
Obtain help and assistance from someone familiar with the locality.

You should also look beyond the standard policy benefits and consider what additional value the provider can offer your clients' employees.
Questions you could ask include:

How financially secure is the provider that I am recommending?
Do employees have access to round-the-clock support and advice from a multi-lingual medical advice line 24 hours a day, 365 days a year, irrespective of their time zone?
Are employees restricted to a defined hospital list?
Can the insurer settle large bills directly with the hospital or does the employee have to pay the bill themselves and claim the money back?
Can the insurer settle bills in the local currency where necessary?
What kind of evacuation facility is available in the event of them falling ill where treatment is not available?
How simple is the claims process and what additional support is available?
Does the provider offer tailored policy support material and an online support, such as a member management facility and a wide range of information giving practical and expert insight to help you help your clients?

Teresa Rogers is international sales and marketing manager at Aviva UK Health