In some cases, medical treatment in a foreign country can end up costing tens or even hundreds of thousands of dollars. One day of hospitalization in the United States, for example, might cost tens of thousands of dollars - more than the cost of the entire trip. Therefore, travel insurance is not a luxury, but a necessity, for anyone who does not want to find himself with a giant hole in his pocket or even without the ability to pay for medical treatment if required.
According to a survey conducted by TNS Teleseker for the Clalit health maintenance organization, most Israelis (86 percent) make a point of taking out travel insurance before traveling abroad. The survey also found that the travel insurance market is overwhelmingly dominated by the HMOs and the credit card companies - 45 percent of respondents who took out travel insurance did so through their respective HMOs, while 23 percent were insured through their credit card companies. The other travelers insured themselves through one of the direct insurance companies (12 percent) or their travel agencies (12 percent).
However, despite the considerable importance of the policy we take abroad with us (after all, in an emergency situation, we are totally dependent on the policy), many travelers fail to look at the fine print and at the types of coverage the policy provides: Only 36 percent said they carefully review the policy to a large extent or very large extent; the rest do so to a moderate extent (41), and some do not even open the policy at all (23 percent).
Consequently, we conducted a comparison of the most popular policies in Israel (see box), from both the credit card companies and the HMOs.
The basic difference between the policies of the credit card companies and the HMO policies is that the former come free of charge, as part of the benefits granted to cardholders, whereas the HMO policies entail a charge of several dollars per day. By nature, this difference has an impact on the quality of the policy, and the gaps between them are readily apparent already upon first glance.
Deductible: The credit card company policies exact a much higher deductible than the HMOs ($80-100 for the credit card companies as opposed to $30-50 for the HMOs). This is an important section, because in many cases, the medical expenses abroad amount to several tens or hundreds of dollars - for example, for medications or emergency dental treatment - and in such cases, the size of the deductible makes the difference between a good policy and a worthless one.
Spending on medication: The credit card companies' basic policy does not cover spending on medication, whereas the basic HMO policy does. Incidentally, the policies of the HMOs differ widely among them in this regard: The Meuhedet Blue Passport policy, for example, limits coverage for medication to $150; the Maccabi Ilit policy limits it to $400; and the Clalit Abroad and Leumit Darconit polices provide unlimited coverage for medication.
Expenses not related to hospitalization: While the credit card companies cover these expenses for amounts that do not exceed $1,500-1,600, the HMOs provide coverage of several hundreds of thousand of dollars. This is an important and practical section of the policy's coverage that includes all treatments that do not end in hospitalization. These treatments can be quite expensive and it is worth taking this into account when purchasing a policy.
There are several advantages to the credit card company policies beyond the fact that they are offered to cardholders for no extra fee.
Emergency dental treatment: Credit card company travel insurance policies provide $500-1,100 in coverage for emergency dental treatment, as opposed to $200-400 from the HMOs. Thus the lower limit of the credit card companies is higher than the upper limit of the HMOs - a significant difference.
Medical airlift: The credit card companies also provide full coverage for a medical airlift to Israel. Of the HMOs, only Maccabi provides such coverage. Meuhedet charges a supplement of $15 for the coverage; Clalit limits coverage to $300,000 and Leumit limits it to $600,000.
Coverage of hospitalization costs: Regarding coverage in the event of hospitalization, the credit card companies provide similar coverage to that offered by Clalit and Meuhedet - around $300,000. Considering that this is a free policy, this parity becomes a clear advantage for the credit card companies. However, Maccabi and Leumit policyholders are offered much higher coverage - $1 million at Maccabi, and $600,000 at Leumit.
The bottom line is that the credit card companies' basic policies are very similar to one another, but there are a few exceptions. Examples: Coverage for a third-party injury is five times higher with Visa CAL than with Isracard ($50,000 as opposed to $10,000); Leumi Card offers twice as much coverage than its two competitors for dental treatment ($1,100 as opposed to $500); the maximum coverage for hospitalization is provided by Visa CAL ($330,000) and the lowest is provided by Leumi Card ($260,000).
As for the HMOs, a comparison of all the different elements is seemingly pointless because each customer is insured at only one HMO. However, and contrary to other supplementary insurances available only from your HMO, with travel insurance, the situation is different: Except for Maccabi, the HMOs also allow those who are not insured by them to buy travel insurance from them. At Leumit and Meuhedet, whoever is interested can purchase travel insurance (at Meuhedet, only members will receive discounts); Clalit allows first-degree relatives (spouse, parent, child) of HMO members to purchase a policy from it.
In addition, the maximum coverage for hospitalization costs at Maccabi Ilit is considerably higher than at its competitors - $1 million as opposed to $300,000 at Clalit Abroad and Meuhedet Blue Passport and $600,000 at Darconit Leumit. However, the daily premium at Maccabi Ilit is substantially higher than the premium charged by the others - $4.20-10.00 per day at Maccabi (depending on age, up to 65) as opposed to $1.05-2.10 at the other HMOs.
Clalit has an edge when it comes to deductibles ($30 compared to $50 at the other HMOs), coverage for dental treatment and in compensation for canceled flights and shortened trips.
Leumit lags slightly behind Clalit and Maccabi when it comes to coverage, but the poorest coverage compared to the other HMOs is provided by the Meuhedet Blue Passport policy, which did not have a single advantage over any of the other HMOs in any of the parameters reviewed, and the fee charged policyholders was higher than that charged by Clalit and Leumit ($1,80 per day).
However, the HMO does have two other types of policies - the Silver Passport and the Gold Passport. The daily premium for the Silver Passport policy is slightly higher than the basic Blue Passport premium ($2.00 per day up to age 60, and $2.30 per day for those 61-65) and the coverage provided is higher - $1 million for hospitalization expenses and non-hospitalization related expenses, $100,000 for third-party injuries and others.
The bottom line is that beyond the basic comparison presented here, each person has to find a policy best suited to him/her. So, for example, a pregnant woman or traveler embarking on a challenging trek in the Far East cannot make do with basic coverage and will need to purchase supplements suited to their needs. The credit card companies and the HMOs are prepared to provide for these special needs, for an additional fee.
Just as important as the coverage included in the policy you bought is the coverage that is not included; and one should consider extending the policy or purchasing another one if required.
Here is a list of examples, on the tip of the iceberg, of exceptions and restrictions in basic policies: Clalit does not cover tests and/or treatments that can be delayed until the policyholder's return to Israel, cases related to pregnancy and birth (except for a spontaneous miscarriage or a miscarriage due to an ectopic pregnancy), mental disorders, nonprescription medications and others; Maccabi does not cover follow-up visits, visits to get a second opinion, vaccinations, psychiatric treatment, extreme sports, road accidents in cases where the policyholder did not have a valid local driving license and other cases; Meuhedet's Blue Passport does not cover extreme sports, drinking to the point of inebriation, earthquakes, medical airlift, hospitalization up to 150 days, and other cases; Leumit does not cover competitive sports (skiing, water skiing and others), an accident caused as a result of work in return for payment, mental disorders, expenses that can be delayed until the policyholder's return to Israel, hearing aides and more.
However, all the HMOs and insurance companies offer, as mentioned, extensions for a fee; the most notable among them are coverage for pregnancy problems (although it is important to realize that in most cases this is insurance for the mother only and not for the fetus), various types of extreme sports, coverage for problems stemming from existing ailments, higher coverage, enhanced baggage insurance and more.