Protecting Employees Abroad: International Insurance Choices

There are a variety of different coverages to consider and choose from when employees travel internationally. We are currently seeing an uptick in situations and receiving questions about matters that used to be rare or even nonexistent. These questions include:

• What can be done if an employee contracts an endemic disease while traveling for work?
• Do we have coverage to evacuate employees in areas where civil unrest or war has broken out?
• How can we protect employees traveling in areas of the world where kidnapping is a feasible threat?

To follow, we will provide a summary of three of the most important international insurance coverages you can choose to protect both your employees and your company in these tumultuous times.

Foreign Voluntary Workers’ Compensation (FVWC)

Foreign Voluntary Workers’ Compensation (FVWC) is an important coverage for any company that has business outside of the United States to consider. FVWC can apply to a multitude of employees, including:

• US hires: Persons who were hired and predominantly work in the US.
• Expatriates: Also known as “ex-pats,” they may be on a temporary, short-term, or long-term assignment. They may also be residing outside of their native country permanently.
• Independent contractors: May extend to an independent contractor via contract.
• Local nationals: Employees who are hired to work in their country of origin.
• Third-country nationals: Employees who are hired in their country of origin and assigned to work in another country.

FVWC typically provides coverage for the following:

• Medical assistance
• Endemic disease
• Repatriation
• War & terrorism (although this may vary by carrier)

One FVWC endorsement that is relevant to current events involves Political, Security and Natural Catastrophe Evacuation & Relocation Expense. The name of the endorsement can vary by carrier, but the purpose is the same: to get employees out of harm’s way should any number of disasters occur while an employee is traveling for business.

Of particular note is the fact that the Political, Security and Natural Catastrophe Evacuation & Relocation Expense Endorsement does not require an employee to be injured. The sole purpose of this coverage is to evacuate and relocate employees to a safer location.

An example of this pertains to a client who recently contacted us for help concerning an employee who was in Israel with his child. The client had elected to procure the Political, Security and Natural Catastrophe Evacuation & Relocation Expense Endorsement, which paid to evacuate the employee to his country of origin.

Business Travel Accident (BTA)

Business Travel Accident (BTA) is corporate insurance intended to provide coverage for employees involved in accidents while traveling.

Under the BTA plan:

• Employer selects eligibility definition
• It can apply to all employees or select classes
• Policies can be issued as a group or individually

Coverage and provisions of the BTA policy include:

• Accidental death and dismemberment during business trips.
• Typically for trips up to 180 days but may be extended to 365.
• 24-hour access to assistance with direct payments to facilities.
• Assistance with non-medical matters (ex. lost baggage, lost documents, re-bookings).
• Can be extended to non-employee groups (ex. spouses, children, non-employee board members).
• Emergency (medical) evacuation is dependent on the severity of injury. Must be 100 miles outside place of current residence and subject to a physician’s authorization.
• Some policies may also cover non-health emergencies such as terrorism, abduction, and natural disasters.

Kidnap, Ransom & Extortion

Though not relegated to international travel, it is particularly important for any company with employees traveling to certain parts of the world to consider the risk of becoming a target for kidnappers. Kidnap, Ransom & Extortion (KR&E) coverage provides this protection. 

Businesses that may be especially prone to this risk include (but are not limited to):

• Financial institutions
• Private companies
• Public companies
• Nonprofits
• Schools and universities
• Entertainment companies
• Healthcare facilities
• Anyone with a high net worth or notoriety

Situations that may require KR&E include but are not limited to:

• Child abduction
• Wrongful detention
• Hostage crisis
• Product extortion
• Hijack

Some coverage extensions that may not be included in a basic policy but should be considered, based on your business needs, include:

• Business interruption
• Emergency security evacuation
• Stalking threat
• Product recall expenses

Generally, employers may want to avoid sending their employees to any areas that appear as red on the US State Department’s travel advisory map. However, if an unfortunate event occurs and the KR&E policy is triggered, highly trained experts will be procured to manage the situation. This includes everything from obtaining proof of life to ensuring the safe return of the captive.

Safeguard Your Employees and Your Company

We all know and have likely experienced the fact that traveling for pleasure can be fraught with challenges and hazards. When your employees travel abroad, there are even more perils to consider, and you must ensure that both your company and your employees are protected. Work with an experienced broker who can recommend and place the coverage that will best safeguard your employees should a catastrophe strike.