A rogue wave pulled a vacationing military contractor walking on a foreign beach into the ocean. He hit his head on a rock and was paralyzed.

Because his employer sent him on the trip for some R&R, the contractor’s Foreign Voluntary Workers’ Compensation insurance responded for his medical injuries even though he was vacationing instead of at a job site.

Luckily for the worker, his employer had the right coverage in place to forestall painful financial and health consequences.

But a substantial risk for employees and the companies they work for is that how and when coverage responds overseas often doesn’t track how coverage responds stateside, said Mary Quillen, manager, international workers’ compensation, AkesoCare.

Multinationals tend to carry many overlapping lines of insurance for their overseas business travelers, which is a help.

“You may have six or seven lines of insurance responding to a single claim,” said Logan Payne, assistant vice president, international practice, Lockton.

The primary policies are Foreign Voluntary Worker’s Compensation, Business Travelers Accident, and Kidnap, Ransom and Extortion, Payne said. Purchased effectively the coverages can be powerful. Purchased without the proper consideration, they may suffer from gaps as well as redundancies. Such gaps can cost employees dearly at a desperate time of their lives, Payne said.

To prevent that, he recommends centralizing insurance purchasing for expats instead of delegating it piecemeal to departments or regional offices. “Get all the insurance buyers in the same room to reach one comprehensive answer,” he said.

“Who does the traveler call if he loses his prescription drugs or needs medical evacuation? Who does he call if he hears gunshots outside his hotel?” — Chris Chao, senior vice president, Aon

International benefits from domestic health care insurance can range from nonexistent to “pretty good,” said Arno Chrispeels, owner, Health Insurance International. “A plan might cover emergency medical treatment but not evacuation or repatriation,” he said.

Since these are hefty expenses — $20,000 to $100,000 for a helicopter evacuation and $15,000 to $25,000 for repatriation — companies should review their domestic policies and fill in gaps by using international insurance for short- and long-term travelers.

Chris Chao, a senior vice president at Aon, said it is generally the travel assistance provider that keeps expats safe.

“Who does the traveler call if he loses his prescription drugs or needs medical evacuation? Who does he call if he hears gunshots outside his hotel?” Chao asked.

Duties of Care and Loyalty

When companies send workers out of the country, they have a “duty of care” to keep employees safe and healthy, while the expat workers have a “duty of loyalty” to follow their employers’ safety practices. Sometimes this requires workarounds and major effort. For example, said Denise Buckland, senior vice president, operations, International Medical Group, if a worker is diagnosed with an autoimmune disease, doctors will try staged medications.

Denise Buckland, senior vice president, operations, International Medical Group

“You try one, and if it doesn’t work, you try another,” she said. But the options can be very limited.

Let’s say a U.S. employee working in Thailand requires the injectable Humira to manage her condition, and no other drug gives her the relief she needs. Humira is illegal in Thailand, however. The carrier could contact the Thai and U.S. governments to help the employee get an importer’s license, but in the meantime, Buckland said, “the worker may get so sick that she has to go home.”

Especially in regions where the medical infrastructure is underdeveloped by Western standards, an acute but treatable event, such as a compound bone fracture, could quickly escalate into a life-threatening medical issue, said Alison Swanz, senior consultant, Arthur J. Gallagher & Co.

Duty of care is still an “unregulated philosophy,” said Hart Brown, senior vice president, practice leader, organizational resilience, HUB International. It depends on a number of interrelated steps, beginning with a vetted travel assistance provider and adequate insurance.

An employer “hasn’t met its duty of care” if its travel assistance provider does not have the right protocols or its expats don’t know the provider’s toll-free number, he said.

“Compliance is hard to enforce. You can’t sit on an adult to make him take his meds.” — Alison Swanz, senior consultant, Arthur J. Gallagher & Co.

Coverage gaps and potential risks should be exposed in a thorough pre-trip screening, said Rob Howard, director of corporate sales, GeoBlue, a major provider of international insurance for expatriates.

When employees need medical help while on assignment, carriers will tap their provider networks to find care equivalent to what they would get at home, said Howard.

Pre-assignment evaluations should extend beyond known health issues, said Nick Dobelbower, vice president, global benefits practice, Lockton, to include language training if necessary, and alert the traveler to cultural differences and sensitivities.

Chris Chao, senior vice president, Aon

The onus is on the employee to make a responsible decision whether to go on an overseas assignment. Sometimes, employees should decline assignments, Swanz said. A worker with asthma probably shouldn’t accept an offer in Beijing, where air pollution is a health hazard.

“An executive expat assignment is a huge investment for the company,” Howard said, and may include high compensation, language training, housing, security, a driver and private schools.

To recoup that investment, companies expect an executive assignment to last three to five years, but more than 50 percent end in failure after six to nine months. Among the top reasons for failure are the expat’s benefits package and health care, according to Cigna’s “2015 Global Mobility Survey.”

Duty of care and duty of loyalty should align during pre-trip planning, said Howard. He recommends a sit-down orientation with travelers as a group before they leave to review the size and scope of risks.

Other issues such as domestic employees can arise, Chrispeels said. “Employees may think they have international coverage for the entire household [such as nannies], but they don’t.”

The organization should also consider issues such as family mental health problems. A one-on-one meeting or a follow-up phone call may bring issues to light when travelers have medical issues they don’t want to share with a group.

One aspect of an employee’s duty of loyalty applies to medical compliance, especially to taking prescribed medications for common diseases such as heart conditions or asthma.

Alison Swanz, senior consultant, Arthur J. Gallagher & Co.

“Compliance is hard to enforce. You can’t sit on an adult to make him take his meds,” Swanz said.

U.S. companies that send U.S. citizens overseas are subject to the Affordable Care Act, but the law is so complex — despite Congress’ attempt at guidance in the Expatriate Health Coverage Clarification Act of 2014 (EHCCA) — that “people get glassy-eyed looking at it,” said Mark Holloway, senior vice president, co-director, compliance services, Lockton.

Holloway recommends that companies write their expat coverage on U.S. paper as a practical way to satisfy the individual mandate — but to work with professionals who deal in expatriate insurance every day.

“Companies will want to work with a broker or counsel who plays in the sandbox because it’s such an arcane area of the law.”