New Zealanders are traveling abroad in record numbers – over 2.9 million people travelled out of New Zealand airports last year – and one of their favourite destinations is the United States. Kiwis are a responsible bunch, according to MoneyHub, only one in six Kiwis holiday or venture abroad without travel insurance. Kiwis are also fiercely loyal, they overwhelmingly prefer to purchase travel insurance from New Zealand-based travel insurance companies. However, there is a new trend on the horizon of non-US travellers purchasing US-based travel insurance based on lower cost, increased benefits and ease of filing medical or loss claims for luggage, flight delays and other travel mishaps.
Silicon Valley-based travel insurance company, VisitorsCoverage, reports a 120 percent increase in New Zealanders searching for and comparing travel insurance policies on their site, and an almost 100 percent increase in sales of travel insurance policies to Kiwis for travel to the US for the first half of 2018, compared to 2017 statistics.
The United States does not provide universal medical coverage. Unprepared travellers who did not purchase travel insurance and sustain serious injury or a catastrophic medical incident in the US risk incurring financial liability that can easily run over $100,000, as the US also has one of the most expensive healthcare systems in the world. Should a fellow Kiwi require medical air transport back to New Zealand, costs could easily double or triple for medical repatriation.
“Visitors to the US are realizing the cost savings, coverage advantages and convenience of purchasing US-based travel insurance,” says Rajeev Shrivastava, CEO and founder of VisitorsCoverage, an InsurTech company that provides online comparisons of travel insurance policies. Not only do more US-based providers recognize and accept US-based insurance, but non-US policies are generally reimbursement-based and travellers may be required to pay medical costs out-of-pocket at the time of service. Filing a claim for reimbursement later could be complicated, frustrating and lengthy as a result of different time zones and countries.”
Most non-US travel insurance companies use third-party providers to enable them to offer medical and travel insurance in the US, which may result in higher costs to the purchaser as well as higher deductibles. Most policies offered through third-parties rarely offer comprehensive coverage that utilize US-based Preferred Provider Networks (PPOs) – these often have low or no deductibles, and little or no co-pays – provided the traveller uses only physicians and hospitals that are part of the approved provider network.
US-based travel insurance companies partner directly with medical insurance providers who often directly pay all covered claims filed by the traveller, with little or no payment at the time of treatment. Companies like VisitorsCoverage partner with top-rated providers such as IMG, Seven Corners and underwriters like Lloyd’s of London, giving peace of mind to unlucky travellers who actually have to file a claim for medical treatment or loss. Many comprehensive policies offer coverage beyond medical, including lost luggage, flight cancellation or delay, repatriation or border entry denial.
The bottom line for Kiwis travelling to the US? “Take the time to shop around and compare New Zealand-based travel insurance policies with those offered in the US,” Shrivastava continues. “Most US-based travel insurance policies cost the same or more as non-US based policies, depending on age, but the small added cost is worth it if you need to use your plan. It’s really not worth the risk of buying a cheaper policy that could still leave you with a huge, unpaid portion of medical fees should a catastrophic incident occur.”