If your clients are over 50, flush with home equity, and free to roam, chances are they’ve started considering a place to retire. As real estate values in popular U.S. retirement destinations soar, Americans are increasingly looking abroad and finding the welcome mat lain out in places such as Mexico, Panama, Nicaragua, Belize, and Honduras. The cost of living in these locations has always been low, but now there are government-sponsored relocation incentives — no taxes on income earned outside the host country and duty-free import of household goods — to help finance a new lifestyle replete with ocean sunsets, a relaxing pace, and local color. The chance to own a quarter-acre of beachfront property for less than $100,000 doesn’t hurt, either.
The result is a swelling migration of Americans, many from California, heading south to enjoy the promise of idyllic surroundings and an affordable lifestyle. According to the Association of Americans Resident Overseas, there are already more than 1 million Americans living in Mexico and over 100,000 more in Central America. But in the rush to invest and relocate, few are taking the proper steps to guard their health with the right health plans and services. Perhaps swayed by real estate developers’ spins that local doctors make house calls, answer their own phones, take time with their patients, and charge low fees, new arrivals often rely on the low stress and clean air as a powerful health tonic and expect their current health plan to adequately protect them.
Inevitably, however, reality sinks in. Your clients may be enjoying tax breaks and ocean breezes, but once they’re over 50, chronic conditions don’t disappear, and serious sickness and injury are increasingly probable. Important questions bubble up: Where did the local physicians go to medical school? How well do they speak English? What is the procedure for emergency evacuation? Is it a covered benefit with inside limits?
As their insurance agent, you need to be equipped to help these expatriates stay safe and healthy with the right plans and services. What are the best solutions? Traditional options have notable shortcomings, but there are international health plans that address these problems and are important to understand.
First, let’s take a look at some of the options retirees traditionally grasp, with an eye on their potential pitfalls. The table below highlights the shortcomings of six different types of insurance coverage that retirees might bring with them when they relocate. These alternatives bear little resemblance to each other and are often in place by default or taken out on short notice as stop-gap measures based on a word-of-mouth recommendation. Remember, of course, that Medicare does not cover any health services delivered outside the U.S.
In addition to those plans listed, there exist guaranteed issue plans for stints abroad of six months or less and medically underwritten major medical plans for those who relocate. So how do you find the right plan for your client? It starts with selecting a few basic parameters to help profile your retiree customer and to take the measure of all available health plans.