When you are picking out a travel insurance plan, you will see a dollar amount listed as the policy maximum. There may even be a few choices for your policy maximum. But what factors contribute to the cost and how large of a policy maximum should you buy?
What is a Policy Maximum?
A policy maximum is just what it sounds like, its the maximum amount of money that your insurance plan will pay. This number can be anywhere between $10,000 USD and $8 million USD, although exact amounts will vary from plan to plan. If you need to use your plan during your travels, the travel insurance plan will cover the expenses detailed in the policy documentation up to the policy maximum amount.
For example, Lets say that you purchase a travel insurance plan with a policy maximum of $100,000 and had an accident where you needed to go to the hospital. Your insurance will pay a maximum of $100,000 of your medical expenses after the deductible is met. So if your eligible expenses only total $90,000, it will all be paid according to the details of your policy. However, if your eligible medical expenses total $140,000, the policy will only pay that first $100,000 and you will be responsible for the remaining $40,000.
Its important to get a high enough policy maximum that the entirety of your medical bills will be covered should something catastrophic happen while you are traveling. Depending on where you are traveling, you may need a higher policy maximum. For example, if you are visiting the United States, where medical costs are notoriously high, you may need a higher policy maximum than if you are traveling in the European Union or Canada.
What Factors Determine the Cost of a Plan and Policy Maximum for Visitors Insurance?
There are a number of factors that decide the cost of a travel medical insurance plan, and should impact your decision. The following are some questions to ask yourself to help decide on what policy maximum you should get.
- For how long will you be traveling? One of the key details that any travel plan must start with is how long you plan to be away from home. If you are going to be abroad for longer, there is a higher chance of something going wrong and therefore a higher chance that you will need to use your travel insurance policy. If you are going to be traveling for a longer time (longer than a month or two) you may want to consider a higher policy maximum option.
- How old are the travelers? Some plans may have restrictions or different policy maximums for travelers over the age of 69, 79 or 89. Furthermore, older travelers may be more prone to accidents and healthcare costs may be higher for geriatric patients. For older travelers, higher policy maximums may be a prudent choice.
- To what country are you traveling? Different countries have vastly different healthcare costs. A $50,000 policy maximum may be more than enough for travel through most of Asia, that amount will likely only cover one hospital visit in the United States. If you are traveling to a country with higher health care costs, you will want to consider that when choosing a policy maximum for your plan.
- Do any of the travelers have pre-existing conditions? Pre-existing conditions are covered differently on travel medical plans than you may be used to in your domestic healthcare plans. If a condition exists prior to departing your home country, that condition may not be covered under your travel medical insurance plan. Certain plans, like INF Elite , however, can cover the worsening of pre-existing conditions. These types of plans may have higher premiums, but they come with higher policy maximums and more coverage.
- What types of activities do you want to do on your trip? If you plan to do adventure sports or other high-risk activities, you will have a higher chance of needing medical care while you are abroad. Make sure you get a plan that covers the type of sport you plan on participating in and consider a higher policy maximum as well.
How Large of a Policy Maximum Do I Need?
So once you consider all of these criteria, whats the answer? How high of a policy maximum do you really need? If youre an older traveler with pre-existing conditions going to the United States, youre likely to want a high policy maximum. But in most cases, you will need to weigh the risks of travel against how much you are willing to pay for your travel medical insurance.
Higher policy maximums are the safest option to make sure that all of your medical bills are covered. However, you may not want to pay the extra premiums if you do not expect to use all of the money. It is a personal choice that will vary from person to person.
If you would like more advice tailored to your situation, please reach out to our licensed travel insurance experts . We will be happy to assist you in finding the perfect plan for your needs and deciding upon a policy maximum that works for you.