What expats need to know about life insurance

Life cover isn’t exactly a topic many expats enjoy discussing over a cocktail. However it’s important to know and share the facts, especially when you are living overseas. As much as people don’t like to talk about it, life insurance is important, especially to expat with families or dependents who rely on their income.
For Brits living overseas there is often a temptation to rely on life cover they may already have back at home, but in nearly every case, the terms of the policy only protects them whilst they are living in the UK.
If you are an expat, one of the first steps to safeguard your finances when moving to another country should be to look at your current life policies.

Who should I talk to first?

Talk to your life policy insurer – get them to tell you the facts about your policy. Find out if they will still offer cover once you leave your home country, and if the cover is enough to provide for your loved ones should any unforeseen circumstances occur.

What do I need to ask?

Warm up the conversation with these questions.

1. Exactly which countries does my policy cover?

If you move between countries, ask the insurer to make sure the policy is still valid and no exclusions apply.
Even if a policy is portable, many insurers will decline to cover expats living in some countries. Make sure the insurer tells you which countries your policy covers you in.
Expat life cover is often offered with renewable or reviewable pricing. Cover is often cheaper if the person whose life is protected has a UK address and bank account. This works if you are moving abroad on assignment for a while, but not if you are retiring or permanently shifting a home.

2. How will local taxes in my new country of residence affect my claim?

The tax treatment of insurance pay outs varies between countries and the sum assured may not be enough in some places.

3. What add-ons are included in my policy?

One important add-on for expats to inquire about is accidental death cover.
This pays out if someone with life cover dies anywhere in the world, providing the death is not the result of ill health. Accidental death cover is not subject to medical underwriting as state of health is irrelevant to the pay-out.
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My insurance policy doesn’t cover me in my new country of residence, what now?

Don’t count on your employer covering the costs of your medical bills, or recovery period from a critical illness either. At this stage it’s advised to speak with an international financial adviser in your region, who can offer you advice on what you need, and how to get the best package to suit your personal situation.
What other forms of protection will I need when living overseas?
If you are an expat on assignment with life cover provided by an employer, you may still need personal cover as not everything will be covered by the company.

It’s important for expats to look into critical illness cover and income protection.

Why do I need critical illness cover if I already have health insurance?

Critical illness cover is crucial when living overseas as you need to have safeguards in place to replace your monthly income if you don’t have savings to cover you if you become seriously ill or disabled. Also if you don’t have an employee benefits package to cover yourself and your family during the time you take off work to recover from sickness.
Critical illness cover is a long-term insurance policy to cover specific serious illnesses listed within a policy. Should the worst happen, it gives a tax-free ‘lump sum’ – a one-off payment, to help pay for your mortgage or rent, debts, or pay for alterations to your home such as wheelchair access should you need it, but it’s your choice how you spend it.

Isn’t this all covered through my travel insurance?

No; don’t rely on travel insurance for life or medical cover. These are short-term fixes for tourists, not expats.

To get more facts about which life cover if right for you and your family, it’s advised to arrange a meeting with an international financial adviser in your region today. Globaleye’s international advisers understand there is no one-size fits all approach and will work with you to design a tailor made solution to fully suit your global needs. 

Get in touch with me today and protect yourself for tomorrow