14th international travel insurance conference · with the new agenda format, which saw travel...

PRAGUE 2006

14th international travel insurance conference

3rd international private healthcare conference

1st international air ambulance forum

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International Travel Insurance Journal n www.itij.co.uk

Voyageur Event Management would like to thank the following moderators for their expert assistance with the panel sessions in Prague:

Dr Charlie Easmon Matt Kalina

David Ewing Andy Juggins

Julie Remmington Ian Cameron

This year’s International Travel Insurance (ITIC) in Prague was indisputably the best in the conference’s 15-year history. Not just because of record attendance figures, but delegates were delighted with the new agenda format, which saw travel insurance sessions interspersed with those of the 3rd International Private Healthcare Conference (IPHC) and the 1st Air Ambulance Forum.

A number of focus groups that discussed a variety of topics supplemented the conference sessions and proved as popular as ever. And coffee breaks and lunches provided unrivaled networking opportunities in a more relaxed environment.

Meanwhile, a plethora of social and networking events throughout the four days of the conference ensured there was never a dull moment, and a great deal of fun was had along the way at the packed welcome function, the hotly contended quiz night, the dazzling jazz river cruise, and of course, the unparalleled grand finale – the International Travel Insurance Journal (ITIJ) Gala Dinner and Awards Ceremony.

A full review of the ITIC, IPHC and IAAF sessions can be found over the following pages, along with photographs from throughout the event in Prague.

Thank you to the ITIC committee:

Steve Wilcox, AXA InsuranceBarbara Montenegro,Mapfre AsistenciaJan Sander, SOS InternationalPhillip Brun, HygeiaAndy Juggins, Royal Bank of ScotlandFranz Benstetter, Munich ReFiona McDonald, Europ AssistanceJulie Remmington,Travel Insurance Suppliers NetworkMartha Turnbull,RBC/Assured AssistanceOle Aerthoj, Goudse Schadeverze-Keringen N.V.Paul Beven, Healix International

Thank you to the IPHC committee:

Dr Charlie Easmon,Number One ClinicSarah Dennis,Norwich Union HealthcareCarl Carter, IMG Europe

Thank you to the IAAF committee:

David Ewing, Skyservice Aviation Inc.Volker Lemke, FAIRupert Dent, Air Medical Ltd

Delegates were welcomed to Prague in style, with an opening event held at the rooftop restaurant of the Hotel InterContinental Praha, which boasts glorious views over the city. The Hygeia Welcome Function saw delegates old and new entertained into the night – a fitting start to a dynamic and productive four days.

The Hygeia Welcome Function

Voyageur Event Management would like to thank the 2006 sponsors:

ITIC conference report by Sarah Lee

IPHC & IAAF reports by Hannah Langfield

Welcome function Hygeia CorporationWelcome banner EvropskaDelegate badges Medsave USADelegate bags SkyService Air AmbulanceLunch drinks Jet ICURiver cruise European Air Ambulance & Dr Colin Plotkin ConsultingQuiz night &Networking dinner One World AssistHangover kits Rowland BrothersTable football tournament Stones SolicitorsInformation point IMG EuropeAwards dinner ITIJPre-dinner drinks & After-show party Canadian Global Air AmbulanceConference DVD American Care Air Ambulance

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An introduction to healthcare in the Czech Republic

Lucie Antosova – Ministry of Health for the Czech Republic

Since shaking off the old centrally-focused, budget-based state health insurance system in 1993, the Czech Republic has operated an obligatory state health insurance system that is based on citizenship. Compared to

other EU member states, healthcare accounts for an almost pinpoint average percentage of GDP, but it is unique in the huge percentage of healthcare spending that comes from public budgets. In fact, in the Czech Republic, 92 per cent of state healthcare financing is from public funds, and just eight per cent is from the private sector, which predominantly supports projects in the pharmaceutical sphere. Contributions are made to the state health fund through a 13.5 per cent income tax, which is split between employee and employer on a nine per cent and 4.5 per cent basis, respectively. There are nine health insurance companies in the Czech Republic, and together with the all-encompassing state hospital network they provide a comprehensive coverage for all citizens, meaning no out-of-pocket expenses need to be met by Czech citizens. This does, however, said Antosova, sometimes lead to the unnecessary consumption of healthcare services. Nevertheless, the insurers themselves, as public companies, ‘concentrate on managing costs rather than budget revenues’ – a process that is aided by a compensation mechanism for high-risk customers.Hospitals, meanwhile, are left to negotiate their own prices with the insurers, although a collective negation process is carried out by some. A joint project between the nine insurers, called the CMU, handles cases whereby payments are to be made to or collected from companies or hospitals abroad.Therefore, concluded Antosova, there is no real need for private medical insurance in the Czech Republic at present, as the state system works effectively and serves everyone equally. However, she appreciates that with technological and medical advances, a need for private cover and treatment may arise if the state cannot keep up with any escalating costs involved with future treatments and the increasing demand on the system. The ageing population, she stated, is one example where such a challenge may be faced in the next five to 10 years. How private health insurance in the country will be implemented and permitted to operate remains to be seen, but, says Antosova, a supplementary system via the current state group of insurers is certainly an option.

Legal implications of the EU gender Directive Philip Woolfson – Avocat (Paris and Brussels) – Steptoe & Johnson LLP

Philip Woolfson gave a fluent and insightful presentation on the impending EU gender Directive and what it might mean for the international travel insurance industry - from what a Directive actually

is, through a history of the gender Directive, to possible levels of implementation and the way forward for insurers. So, what is a Directive? It is a form of EU regulation that sets out minimum requirements and is binding on member governments, although each government can choose how to implement it. Today’s gender Directive has its roots in Article 141 of the Treaty of Rome, which stipulates equal pay for equal work and was drafted in 1957. For various reasons, the principals of this Treaty were not fully implemented, explained Woolfson, until the case of Gabrielle Defrenne in 1975, when Ms Defrenne sued her employer – the airline Sabina – for equal pay in the European court. The court ruled in her favour, as it reasoned that Article 141 could be applied to each and every individual. The court did, however, state that this Article could only be applied to future claims. Likewise, the new gender equality Directive and its unisex rule, which was issued in 2004, will only be applied to new contracts to avoid the sudden readjustment of the market. Unlike previous legislation, however, it is not an employment rule - it is one that encompasses all goods and services and is therefore social policy with a social objective, meaning it will affect insurers in far-reaching ways. Woolfson then discussed how, during the proposal stage of the Directive, the insurance industry was considered and how the apparent differences between men and women regarding access to cover and levels of benefits paid out were deemed to ‘jeopardize the social inclusion of those disadvantaged’, giving some idea of how the EU sees some insurance processes. He then talked us through various recitals (explanations) behind the current Directive and assessed how they could be interpreted by insurers and how they could be applied to the insurance industry, especially in relation to justifying different treatment for men and women, ‘direct discrimination’, private and voluntary insurance and matters regarding maternity and pregnancy. For example, Article 5 of the Directive, which reflects the fact that sex as an actuarial factor should not result in a difference in premiums and benefits for men and women, has as one of its provisions that insurers cannot pass on costs where pregnancy or maternity is concerned in insurance contracts. This poses an obvious problem to travel insurers, who could end up footing the bill for pregnant women who choose to travel in the late stages of pregnancy or to give birth abroad. But following consultations with the European insurance industry, deferral clauses have been inserted regarding this Article, which is also subject to a five-year review. After this time, Article 5 could be taken out or permanent opt-outs for the insurance industry drafted into the law.With the implementation deadline of 21 December 2007 for the gender Directive fast approaching, Woolfson gave an overview of how some EU member states have already implemented the gender regulation, and looked at possible changes in the industry, such as insurers looking to write their business in countries with more favourable gender rules, and, similarly, customers shopping around for better cover.

Do assistance companies serve the client?The first of the ITIC debates delved into the realm of the assistance industry and whether it serves the client, or whether cost containment is now the priority. A topic guaranteed to stir things up, these lively presentations provoked a mixed response from the floor, although the assistance industry in its current form was ultimately voted the overriding popular model. Cost containment,

it was apparent, is a necessary component of today’s travel policies, but it can be applied in a variety of ways by a variety of sources – some more popular than others:

Dr Chris Peach – General practitioner and assistance industry veteran

Chris Peach confidently argued the case for what he terms ‘tour operator assistance’. Claiming that today’s form of assistance company merely hinders the repatriation or hospitalization process, Peach made a convincing

(to some) case for doing away with assistance companies altogether and instead better harnessing the knowledge of tour operators to facilitate the process of dealing with injured or ill travellers.In his line of work as a general practitioner, Peach often participates in PPI (Practitioner Patient Interaction) groups, which induce dialogue between patients and doctors to enable the open discussion of problems between these two sectors. Insurers, he said, should form similar groups, to gain better feedback on their services and better understand the needs of their customers. In the same vein, information on the quality and standards of care available in various resorts around the world should be made available to the travelling public, rather than solely remaining the knowledge of the ‘patriarchal’ assistance company. After explaining the history and changing nature of assistance companies – which Peach said have evolved from small companies with close and effective relationships with tour operator representatives in resorts to large and complex, call centre-based, corporations increasingly owned by insurers – the audience was taught ‘Peach’s laws of paradox’. These laws generally explain how large organizations are often less effective and less ‘hands on’ than smaller, owner-managed organizations. With a long chain of command and complex hierarchical structure, said Peach, large companies suffer from ‘cognitive dissonance’, whereby the outcome of a management decision is the exact opposite to that which was originally intended (eg. ‘hindrance instead of assistance’), unless they create autonomous and dedicated units that focus on core services – which, he declared, they rarely do.So, where assistance companies today have to wait days for a GP to get back to them to verify pre-existing conditions, liaise between a number of involved doctors and various local and home-based offices, and await sign-off from the underwriter, this process can be smoothed out to form a simple repatriation or treatment programme. This, said Peach, would involve merely tour operator assistance and would save a great deal of time while in the same instance providing for a more effective repatriation service. John Tangney Managing Director, Tagney Tours

After falling out with the insurance company he used to insure his clients, John Tangney decided to take matters into his own hands. When customers stopped coming back to Tangney Tours – a specialist tour operator

providing predominantly pilgrimage-based or religious

trips - following complaints over how assistance cases had been handled, Tangney decided to take up the role of assistance partner in so far as he could and, using his local knowledge of the areas his customers visited, arrange hospital stays and flights home for unwell travellers.Thankfully, Tangney’s insurer is very understanding of his often elderly and sometimes terminally ill clients’ needs. The policy he sells states that travellers must have a life expectancy of 28 days after returning home, and the insurer accepts the decision of the treating doctor regarding when to move or how to treat a patient. As an added safety net, Tangney uses the services of UK doctor Chris Peach to confirm any medical decisions.Assistance companies, argued Tangney, often take over the management of a situation despite often being the weakest link in the chain. They are, he said, unaware of the bigger picture and are most interested in keeping costs down. Their structure and processes often mean that it can take days for a decision to be reached on how to proceed with the treatment of a patient. And call centre staff, he stated, often have minimal product knowledge. Add to this some of the scare tactics he has known assistance companies to use with patients to encourage them to act according to their own wishes, the use of an ordinary taxi for the onward journey of a patient arriving home, the use of inappropriate airports by assistance companies, and the employment of staff with poor English (language) skills, and Tangney’s method of taking matters into his own hands started to look convincing.Specialist tour operators, said John, are well respected by their clients, who spend lots of money with them and trust them year after year to provide a complete vacation package, including the services of a reliable insurer and assistance company. In the case of repatriation, the tour operator will also know whether there is a more convenient charter flight that could be used instead of waiting for a response from a separate and removed preferred travel partner chosen by the assistance company. So, in conclusion, although independent travelers will certainly require the services of an assistance company, specialist tour operators, with their ‘finger on the pulse’ in resort and a recognized back-up solution for medical advice, can surely provide advice to travellers and insurers on the situation with their known clients. Can’t they?

international travel insurance sessions

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Steve Hook – Director of Corporate and Travel, Mondial Assistance

Acknowledging that where a specialist tour operator has distinct local knowledge and a good relationship with their insurer, as in the case of Tangney Tours, Steve Hook said this type of ‘assistance’ may be all well

and good, but it cannot seriously compete with the service and expertise offered by dedicated assistance staff. Many tour operators, said Hook, often don’t have the right information or pass on enough information to insurers, so the assistance company doesn’t know who the customer is when they call, making it hard for them to validate policies and causing delays. Assistance companies, on the other hand, are expected to have policy details to hand, 24-hour medical expertise; and they are expected to have a comprehensive medical database, as well as local knowledge and representatives, which he acknowledges is problematic although global assistance networks have been built up. Assistance companies, said Hook, are not driven by cost, but are driven by the medical director’s decision-making process. They exist to repatriate a sick person as quickly as possible, thus providing emergency assistance, not rehabilitative care. But their staff are competent and experienced, where tour operators have separate areas of expertise and are not trained to offer emotional support or provide medical organisation.Assistance companies also provide a number of services that are important to the insurer, explained Hook, including the validation of cover to ensure assistance is provided only where it has been paid for. They can also confirm if a suggested treatment is necessary or relevant to avoid insurers paying in cases of ‘health tourism’; they can notify insurers of large impending losses, especially in cases of treatment in US; they can help insurers estimate reserves and provide consistent cost containment; they help an insurer protect their brand; and they are fully regulated. Hook then went on to point out how insurers could better work with assistance companies by consulting them on policy wording and more effectively providing customer and policy data. He also said insurers should have better sight of the cost containment element of their assistance companies, and should audit their assistance partners regularly, applying penalties for poor levels of leakage and non-achievement of service level agreements.So why do insurers choose an assistance company? It all comes down to price, stated Hook. But, he claimed, travel insurance is too cheap and, resultantly, back end investment is not as good as it could be. Assistance companies’ profit margins are low. “Things will get better through proper investment and that means that the customer has to pay for the product,” said Hook. The tour operator has to accept that there is a price for delivering assistance services, which is key. “It’s not about cost containment, it’s

about service, and I think insurers and assistance companies are focussed on that as a primary factor of selling travel insurance today.”

Marta Santa Maria – General Manager, Mapfre Asistencia

Marta Santa Maria presented her viewpoints regarding the role of assistance companies in a cost containment capacity, invoking much debate on this subject. Cost containment, she said, can be a tool that ensures

good quality throughout the service chain if insurers and assistance companies agree on an effective cost containment policy that is supplied properly. Cost containment practices, said Santa Maria, ensure that clinics and hospitals deliver the correct medical protocols. Citing her experience in Madrid in the early 1990s, she told assembled delegates how British insurers began using Mapfre to make sure travellers were brought to reputable hospitals and subsequently given the correct treatment for their condition. This, naturally, means that the efficiency of the given medical treatment is increased, saving money for the insurer. Cost containment savings, said Santa Maria, can be re-invested in improved technology and training to improve the overall assistance service, and are also passed onto insurers, who in turn can pass savings onto the traveller. It is vital, however, she claimed, that cost containment and assistance departments should be kept separate, with separate training, as their focus is very different. The assistance department is focussed on taking care of the patient and employs assistance doctors, who are repatriation specialists providing a dedicated service. Cost containment departments, on the other hand, provide a reliable providers network at a competitive price, and essentially perform an administrative role. Through these complementary, yet distinct roles, said Santa Maria, the hospital provider retains a reputation for good service and continues to work with the assistance companies; and the insurer has access to competitive pricing and offers a high-quality service to the insurered, hence ultimately serving the client. So, assistance is not all about cost, but quality does come at a price. Cost containment, therefore, keeps prices competitive without compromising quality, and ultimately provides better insurance at a better price. It’s a win-win situation.

The retired: problem or opportunity?As the global population continues to incorporate a greater proportion of older people, this sector is becoming increasingly important for the travel insurance industry. This ITIC panel session looked at what age really means and how insurers and assistance companies can tap into this increasingly affluent travel market

Dr Marios Kyriazis – MD Gerentology, Kings College University

Dr Marios Kyriazis told his audience how anti-ageing medicine deals with the prevention as well as the curing of age-related conditions. This increasingly popular discipline, he said, offers prevention through diet,

lifestyle and exercise, and provides treatment and therapy for a range of conditions. Moreover, it is a concept that insurers would do well to learn more about to enable them to develop age-friendly policies and save themselves time and money.New drug and treatment developments go hand in hand not just with an increased life expectancy, but more importantly an increasingly long health span, said Kyriazis. So, although life expectancy will continue to increase, so will the amount of years that a person stays healthy. As a result, travel insurers should perhaps look at a person’s ‘biological age’ rather than their chronological age. There are, explained Kyriazis, various medical problems that a person could face in later life, such as heart disease or cancer, but there are also mild, biological problems that are relevant to insurers, such as stiff muscles or slightly painful joints. He gave the example of a 75-year-old man travelling to a hot country and suffering a heart attack due to thickening of the blood, initiated by dehydration; which could have been avoided by the man drinking more water. It makes sense for insurers, said Kyriazis, to assess these risks before they appear, by finding out a person’s biological age. This, he explained, can be done by feeding a wide selection of biomarkers into a computer, which will produce a person’s body map, showing areas that are ageing faster than others. This information can then be assessed to calculate risk. Also, with the technological systems in place today, age-related problems can be dealt with even if a medical condition arises when a person is abroad. Kyriazis suggested insurers might consider employing the services of a gerentologist to advise on a course of action for older travellers that become sick abroad – a service that could save insurers a great deal of money in medical claims.

Peter Staddon – Head of Technical Services, British Insurance Brokers Association

Peter Staddon sees every problem as an opportunity, and rightly so, given his convincing arguments for covering today’s growing proportion of older travellers. Armed with statistics to give credence

to his case, Staddon highlighted the demographics of the ageing traveller with enthusiasm and wit and pinpointed the challenges travel insurers need to

overcome to provide a cost-effective solution to entice the grey pound.People today are enjoying much longer retirements that they were thirty or forty years ago, said Staddon. And retirees today are more affluent, more active and healthier. But how do insurers treat this sector of the population? “Diabolically,” said Staddon. The majority of annual travel policies don’t offer cover for those over the age of 60, he said, and while some cover for those up to age 65 they impose heavy premium increases, and such policies are hard to come by for those over 70. Insurers are avoiding the problem and basing their policies on outdated problems and fears, when they could be effectively writing policies for older travellers if they just had the mind to.Staddon then set the industry three challenges to consider and to come up with solutions within the next five years:• The re-evaluation of cover for baggage claims to allow for one single excess for a family travelling together.• Greater flexibility regarding options to remove excesses altogether or to increase excesses to save more money on the travel premium; or asking travellers if their personal effects are already covered under a home insurance policy.• If annual policy age limits cannot be increased to 70 or 75 then insurers should offer loyalty discounts to frequent older travellers with low or no claims.In conclusion, said Staddon, the older traveller definitely provides an opportunity, but only if the insurance industry is brave enough to tackle the issue using proper underwriting skills and with the assistance of professional brokers, as it has done with terrorism cover. “Together we can adapt to the changing world,” he declared. “We can design a policy coverage that the policyholder actually needs and not one that we want to sell.”

Mike Starko – Managing Director, OneWorld Assist

Mike Starko gave a knowledgeable presentation on the Canadian perspective of the older traveller. A country with a unique travelling seniors market, the audience learnt about the history of cover for

the ‘snowbirds’ and how the local travel insurance market caters for the three million such trips made each year.In the early 1990s, the Canadian government dramatically cut back on the amount of compensation it offered for out-of-country medical care, leading to a ‘gold rush’ of travel insurers in the country. From an initial peak of 80 travel insurance providers, this number soon halved, as those without relevant underwriting experience lost out to competitors, US medical inflation skyrocketed and industry consolidation took place. Essentially, explained Starko, the strongest survived.

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Today, these insurers cater successfully to a population of older travellers (generally aged 55 and upwards) that head south to warmer climates for the winter months – a sector known as snowbirds for their migratory practices. Interestingly, travel insurance distribution outlets for snowbirds are predominantly brokers and associations, rather than travel agents, as these travellers predominantly use recreational vehicles to reach their destination, as opposed to air travel, explained Starko.Delegates were then told the most common reasons for medical claims and shown how the cost of claims rises for those over the age of 65. Some of the reasons for these increased costs, explained Starko, are the greater complexity of conditions, longer rehabilitation times and tourist-driven pricing, but there are ways to minimise these costs. So why gamble with the seniors market? Because, said Starko, higher premiums can be charged. It is also a growing market, a healthier and therefore less risk-heavy market, and older travellers are increasingly travelling to destinations outside of the US that have cheaper medical care.There are also strategies that can be implemented to manage the risks associated with older travellers, such as individual medical underwriting, advanced cost containment tools, comprehensive provider networks and physician-to-physician interaction. Therefore, in conclusion, said Starko, the older traveller “is a risk, but also a great opportunity, and if you choose the right partners and you really understand the marketplace, it’s an increasingly valuable and growing [sector].”

Disaster Management: how prepared are we?

Lars Thuesen – Ambassador and Head of Consular Affairs, Danish Ministry of Foreign Affairs

This informative presentation gave an insight into some of the recent major disasters that the Danish Ministry of Foreign Affairs has been involved with, and how the Ministry has improved its preparedness plan

ready for future incidents. Despite assisting Danes affected by the Bali bombings and those caught up in the incidents of September 11, the Asian tsunami was what Lars Thuesen called the ‘wake-up call’ for the Danish Ministry.Unprepared for such a large-scale incident, Thuesen told delegates that the Danish disaster management team was heavily criticised following the tsunami, which lead to an analysis of how the crisis was handled. The investigation found the Danish relief effort lacked organisation and flexibility, lacked correct infrastructure, and lacked co-ordination with other involved parties such as insurers and the press. Resultantly, a crisis management division was created by the Danish consulate, and by 2005, technical infrastructure - such as satellite phones, registration databases and a crisis website - had been set up,

along with a co-ordination group that can meet within two hours of a disaster, allowing the Ministry to cope extremely well with the string of episodes that arose that year. In 2005, the Danish Ministry responded effectively to the London bombings, explosions in Sharm el Sheik in Egypt and Bali, Indonesia, as well as the New Orleans disaster, in each incident identifying Danish nationals in the area and evacuating them where necessary, liaising with family and putting new training into action successfully. But the incident that tested the Ministry’s new organisational and response capacities to the full was the ‘cartoon crisis’ in February, which saw Danish embassies and citizens threatened and targeted by Muslim devotees rioting around the world following a cartoon drawing by a Danish artist of the prophet Mohammed. This was, said Thuesen, the largest crisis for Denmark since the end of the Second World War, but the new mechanisms and personnel systems that had been put into place saw Danes swiftly evacuated from trouble spots, with no reported fatalities. Again, the war between Lebanon and Israel in 2006 tested the Danish Ministry, when it evacuated 6,000 nationals from the area, and Thuesen gave a fascinating description of the response to this crisis – the largest operation in the history of the Ministry. With such experience now under its belt, Denmark, with its population of just five million, now feels it is ready for the next crisis. With its own mandate for action, funding from the Ministry of Finance, a newly de-centralised decision-making system, and enhanced infrastructure, it is certainly in a new league.

Dr Eric A. Guité – Medical Director, Global Assistance and Healthcare

Predominantly using the example of the Asian tsunami, Eric Guité told delegates how his company, located in Bali, responded to this tragedy. Using their experience and local knowledge, as well as their healthcare

expertise, workers from Global Assistance and Healthcare were able to provide targeted assistance and supplies to great effect, and have made a lasting difference in an area devastated by the forces of nature.Indonesia, said Guité, has witnessed 10 major earthquakes since 1992, resulting in a devastating loss of life. Nowhere has this been more greatly felt, however, than Ache’s west coast, which was completely destroyed by the earthquake and subsequent tsunami of 2004. But how can assistance companies help? Disaster management, said Guité, is the responsibility of the public authorities, while the role of the assistance company is limited to the identification of clients amongst the dead or injured, the medical evaluation of the injured, along with monitoring them and confirming guarantee of payment for their care. Assistance companies will also transport the injured to suitable nearby hospitals and arrange repatriation, including that of mortal remains.

Guité then explained how this can be achieved and asked what more could be done by the industry to help in such times of need. He suggested the raising or donation of money to relief efforts; the assistance of NGO staff with medical staff and supplies; and the organisation of a company’s own support actions. For example, following the Asian tsunami, Guité’s company worked with the support of local businesses, the government and the military, overcoming unnecessary bureaucracy, to develop a sustainable solution for the area – namely the Aceh Primary Care Clinic in Calang. Made possible by corporate funding from HSBC and many others and project co-ordination by Rolls-Royce, the centre took just five days to build and became the focal point for the redevelopment of the area. In fact, the project was so succesful, it was replicated in nearby Lambada Lhok. Staff were originally supplied by the assistance company, but are now sourced from the Ministry of Health. Both of these areas are now thriving and are proof that pooling resources and channeling knowledge in the private sector can expand on the capacity of the government to help in a crisis and lead to great accomplishments in disaster zones.

David Fitton – Head, Crisis Group, Foreign and Commonwealth Office (FCO), UK

David Fitton explained the role of the Crisis Group, saying that it acts in a similar way to its equivalent organisation in Denmark, having gone through the same recent period of review and analysis. Essentially, he

said, its objectives are to help people overseas to help themselves; to make special arrangements for overseas nationals in cases of terrorism, civil disturbance or natural disasters; and to provide an effective service in the knowledge that there is no single response for all circumstances.Thus, said Fitton, the government has spent a great deal of time improving its travel advice, which is something that insurers often rely on in claims decisions, and has launched a ‘Know Before You Go’ campaign aimed at educating travellers on the dangers of travelling to certain areas, and promoting travel insurance. But how does it strive to deliver an ‘effective’ response to disasters? Essentially, said Fitton, through the ‘three Ps’:Preparation – having standardised civil contingency plans and emergency plans that are tested on a regular basis.Profile – respond swiftly and practically to disasters, and be visible on the ground, such as through distinctive clothing. The number of rapid deployment teams has been increased since the Asian tsunami, when the UK government didn’t have enough such staff. Give evidence to nationals that the government’s response has been effective.Partnerships – Following the first Bali bombings in 2002, the UK government felt it could do better and has forged partnerships with assistance companies

and NGOs to utilise their staff overseas and to provide aftercare, such as victim support.These principles are tested each time there is a disaster and procedures are refined and built upon following events that show up areas that can be improved upon. Hence, following the attack on the British Consulate building in Istanbul in 2003, new techniques were quickly developed for assisting the government’s own staff - rather than the public. This year, the government produced a guide entitled ‘Support for British nationals abroad’ to better educate travellers as to what they can expect from the FCO in a crisis. Essentially, concluded Fitton, there should be a limit to people’s expectations of the government when it comes to bailing them out when abroad. We can’t just let expectations keep rising, he stated.

The developing US market

Jonathan Ansell – President, US Travel Insurance Association (UStiA)

Jonathan Ansell gave an interesting overview of UStiA, its composition and aims, and presented a history of the US travel insurance industry. Still very much an emerging market, Ansell lead us through the US’s

turbulent history of travel cover and provided an up-to-date analysis on the state of this market today.UStiA is a trade association established in 2004, and its aims include fostering ethical and professional standards of conduct within the industry, cultivating state and government relations, and educating consumers. This it does, explained Ansell, via its board of directors, members and various committees, and through specialist meetings, an annual conference and extensive market research. Well qualified, then, to talk to us about the history of this market, Ansell demonstrated how the travel insurance industry, since its first mention in the New York Times in 1935, has been on something of a rollercoaster ride – from the start of the airline travel boom, through regulator intervention in ‘air insurance’ rates, then a boom in the sixties that saw travel insurance sold from vending machines across the land, to a ‘bust’ in the seventies. However, in the last seven years, said Ansell, the US travel insurance

Questions from the floor following these presentations looked closer at such issues as the role of NGOs; how insurers rely on travel bans; the removal of terrorism exclusions from travel insurance policies; the co-operation between different countries’ embassies during disasters; insurance for tour operators involved in assisting travellers to return home; and delved deeper into the role of the government in helping nationals injured abroad. If you have experience in providing assistance in crisis zones, write to us with your experience to [email protected]

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International Travel Insurance JournalAwards Dinner 2006

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Winner of Air Ambulance of the year Award

Skyservice Air Ambulance operates a fleet of five medically dedicated Learjet 35A air ambulances from bases both in Montreal and Toronto, Canada.

award presented by Michael Braida

Winner of Assistance/ Claims Handler of the Year Award

SOS International a/s is a leading claims and assistance organisation in the Nordics, SOS provides medical and motor assistance for its customers’ customers.

award sponsored by Hygeia Corporation

Winner of Cost Containment /Provider of the Year Award

Hygeia Corporation is a leading US health service company serving the international market.

award sponsored by Direct Line

Winner of Insurer/Underwriter of the Year Award

Insure For All is a travel insurance product meeting the needs of over-65 travellers in today’s market.

award sponsored by Medex

Winner of ITIJ Marketing Campaign of the Year Award

Canadian Global Air Ambulance is an international organisation, providing a wide range of aeromedical solutions.

award sponsored by M Consulting

The winners of this year’s ITIJ Awards were announced at a glittering gala dinner and awards ceremony at the stunning Municipal House in central Prague on 3 November.

ITIJ AWARDS

2006PRAGUEThe Municipal House

ITIJ would like to take this opportunity to thank the sponsors of this year’s Awards:

Direct LineHygeiaMedex Global GroupM Consulting

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industry has again seen something of a boost again, even if the market is still 27 times smaller than that of the UK. The reason for this lack of demand for travel cover in the US, explained Ansell, is threefold: US travellers have limited vacation time (13 days, compared to 42 in Italy and 28 in the UK), they have portable health policies, and 85 per cent travel only to local destinations either inside the US or in Canada or Mexico. On the other side of the coin, he revealed, purchase drivers have predominantly included cover for trip cancellation or interruption, cover for medical evacuation or repatriation, and medical cover for those over 65 or with HMO policies. So, the types of policies that have developed in the US, as confirmed by UStiA’s own studies, tend to be ‘named peril’ instead of ‘all-risk’ products, and single trip policies are the order of the day. Ansell also revealed how comprehensive travel policies or ‘packages’ accounted for the majority of the market’s $1.55 of premiums in 2004, and that these were predominantly bought from four main distribution channels, the most common being direct from suppliers i.e. cruise or tour operators. He also gave the audience a run-down of the average US travel insurance purchaser’s demographics and looked at some of the new special coverages available in the country, such as ‘cancel for any reason’ and ‘hospital of choice’ clauses, which made for a rounded presentation. If that didn’t whet your appetite, then UStiA’s 2007 market study, due to be launched at the Association’s annual conference in California in February surely will.

Cost containment in the US

Virgil Bretz – CEO, Hygeia Corporation

Explaining the nature of Hygeia as a health service intermediary, Virgil Bretz described to the audience the role of such organisations in the international payor market and how they provide ‘strategic health

solutions’. He also gave an overview of healthcare costs in the US, looked at differential pricing and divulged who pays what.The US will have spent around $7,100 per person on healthcare in 2006 – twice the OECD average – making it the single largest market in the world. And with such spending expected to rise by seven per cent each year over the next decade, insurers will continue to face the enormous challenge of managing these huge expenditures. Bretz subsequently explained how ‘Uniform Bills’ are produced by hospitals - essentially equating to the sticker price for products and services - which, he said, no one wants to pay. However, over time, showed Bretz, billed hospital charges are becoming less meaningful, as the ‘gross’ amount billed has become increasingly different to the ‘net’ amount paid. The fairness of this issue was not something Bretz was going to discuss in this presentation, but he

did point out that as an alternative to hospitals closing or lowering costs through lowering quality, they were instead passing on costs from low Medicare and Medicaid reimbursements and the treatment of the uninsured to private payers, including international payers. As a result, for every dollar it costs to treat a private payer’s patient, that payer pays $1.22 to make up the shortfall, illustrated Bretz. After taking us through what percentage of billed charges each type of payer actually pays, Bretz took us through some of the challenges of managing indemnity plans in the high-cost US market, which explain why international payers are paying increasing prices. These include a general policy design that gives plenty of benefits for a low premium or co-payments; minimal steerage and case management opportunities; poor purchasing power (“In a £2.2 trillion [healthcare] market, the international market represents less than 1/10 of one per cent of total volume.”); and untimely payment often leading to penalties or reduced discounts. He then gave ideas on how to manage these problem areas, and discussed common – ‘some conventional, some debateable’ – cost containment tools and their effectiveness.In conclusion, Bretz advocated a strategy that moves beyond pure cost containment to one that accounts for the entire life cycle of a policy and considers the total value chain of industry participants – thus ‘lowering the total net cost of the act and process of purchasing healthcare services’. Faced with an increasing globalisation of healthcare, he warned insurers to “choose your partners carefully … You will be judged by the company that you keep.” Art Weinblatt – Vice-President of Managed Care, Hospital Corporation of America (HCA) East Florida Division

This presentation gave a useful insight into cost pressures on US hospitals and how they invest in their payers and patients, and provided advice on drafting good hospital contracts and maintaining strong relationships with

payers in order to control costs. Remember, said Art Weinblatt, in a hospital environment the orders for services are all done by physicians: “The physician’s pen is the most powerful tool in driving up costs or lowering costs.”Beginning with an overview of how HCA fits into the US healthcare market – it is the largest private hospital company in the US, with over 180 hospitals in 23 US states, as well as in the UK and Switzerland, and in December the company infrastructure will change when it ceases to become a publicly-traded company - Art Weinblatt then explained how hospitals in the US, although deemed to be expensive, invest a great deal of money on behalf of payers and patients. This, he said, is done through meeting the costs involved in a variety of areas: personnel (a nursing shortage in the US has meant that nurses salaries

have gone up dramatically, but hospital groups like HCA are sponsoring university-based nursing courses to encourage more interest in the subject); hospital infrastructure (new emergency rooms and hospitals); physicians (in Florida, ‘physicians are requiring payment subsidies to take care of indigents and uninsureds in emergency rooms’); advancements in technology; patient safety (such as digital ordering systems and radiology initiatives); and the community (taking care of the uninsured and emergency cases regardless of ability to pay accounts form around 70 per cent of HCA’s business). Next on the agenda were the key requirements of a hospital contract. These, volunteered Weinblatt, involve such criteria as clear language, so hospitals essentially ‘receive no more or no less than they are due’ but are protected from non-payment; the ability to remove clients who do not make payments; contracts with payers and networks that have a good reputation; simple rate structures to allow streamlined administration and accurate claims payments; the auditing of contract terms to ensure accuracy; automatic discounting systems; and the communication of key contract terms to payers and hospital collection staff. And lastly, but no less importantly, Weinblatt suggested numerous ways to enhance the relationship between hospitals and international payers. The advice given advocated entering into exclusive relationships with providers, working on joint marketing activities, establishing clear mechanisms for steerage, avoiding stacking networks and silent network activity, and prompt payment of claims. Martha Turnbull – Director of Operations and Medical Claims, RBC Insurance

Martha Turnbull gave a comprehensive analysis of cost containment from a travel insurer’s perspective. Following an introduction to RBC Insurance and its status as the largest provider of travel insurance in Canada

with growing US insurance operations, Turnbull took us through some medical cost containment strategies, navigated us through the US cost containment market, pinpointed some changes in healthcare contracting and outlined some travel medical insurance trends.‘So, why should a travel insurer be interested in cost containment?’ asked Turnbull. Because despite covering for a range of risks – loss of baggage, trip cancellation and so forth – medical claims are a huge part of what travel insurers pay out, and how these costs are managed can seriously affect the profitability of a travel insurance company. And what is a reasonable or equitable price for quality care? This, said Turnbull, is difficult to benchmark but it is often interesting in different markets to compare Medicare costs to the UB bill to see the difference between cost to charge ratio. Essentially, however, insurers

“Choose

your partners

carefully…you will

be judged by the

company that you

keep.”

ixCONFERENCEREVIEW


have to analyse how their cost containment strategy impacts their clients. Importantly, then, such a strategy should ensure that travel policies are designed to clearly communicate their terms to customers and, in the US, providers. The language in these ‘contracts’ should also clearly address the issues of pre-authorisation, as well as case management, benefit differentials and steerage. With regards to case management, done well, this, said Turnbull, is essential to brand value. And, similarly, prompt payment is also beneficial to insurer’s business performance records.Other key cost containment strategies for insurers include knowing your provider, knowing where your clients are travelling to, and deciding whether to build your own cost containment strategies or to buy them. Either way, insurers need to fully understand the nature of healthcare provision and billing in order to operate effectively in the US market. They also need to know who can do what at each stage of the value chain and decide where they fit in.Understanding the local healthcare market is, ultimately, the basis for beginning cost containment practices. As Turnbull illustrated, the US market is an extremely complex and has seen considerable changes over the last five to 10 years. However, those involved in doing business in the US need to understand the difference between concepts such as competition and single health provider systems, they need to bear in mind the growth in bad debt and the importance of cash flow to healthcare providers, and they need to understand that ‘commercial dollars are the key to the profitability of every provider’. Increasingly, said Turnbull, there is scrutiny of discounted payments and the recovery late payments or illegal discounts in the US, posing a challenge for insurers. So, if insurers don’t invest in prompt payment, not only will they have difficulty in contracting with providers but they will expose themselves to operational risks in terms of losing their original discount.Turnbull rounded off her presentation with a look at changes in healthcare contracting in the US, recent regulation streamlining healthcare provision, trends relating to the relationship between insurers and providers, and changes in the ‘rental’ PPO market. At the end of the day, she concluded, insurers will have to ask whether their cost containment strategy makes them an ‘active risk manager’ or a ‘passive complaining observer’.

Dr Franz Benstetter – Head of Managed Care Services, Munich Re

Dr Franz Benstetter demonstrated some international trends in healthcare costs, which he said are important for insurers and reinsurers to understand, and explained some of the reasons behind cost increases. He

then gave advice on controlling medical costs through insurance product design and managed care.

In general, said Benstetter, healthcare costs are expected to increase due to rises in the cost of services – aided by an ageing population, changing morbidity and medical progress - and a growth in utilization. This, he said, all leads to a rise in major claims. Likewise, a shift in costs from the public to the private sector is also having an effect in insurers, but, says Benstetter, in some areas, the rise in healthcare costs do not match a rise in the quality of care.Using the example of coronary heart disease (CHD), Benstetter then showed how different factors combine to produce cost increases. At the beginning of the 1980s, he explained, there were two major treatments for CHD: a bypass procedure that was fairly complicated, carried a relatively high risk and costs around EU15,000; and a balloon dilation (PTCA) procedure that was comparatively simple, low-risk and cost EU3,300. Thus, the expectation was that in coming years, the number of bypass operations would decrease and the cost of this procedure would stabilise, and the number of PTCA operations would increase. In reality, the number of both of these procedures increased dramatically, as did their costs. The reasons? Amongst other things, an ageing population has meant that more people are being treated for CHD and at a later stage in their life; an expansion of both procedures means older patients can be treated, as well as those with a milder form of the disease; and PTCA often requires repeat procedures. By understanding the impetus behind cost increases, insurers and re-insurers can better develop systems and products to incorporate the correct cost containment approach, said Benstetter. Thus, insurance products have more commonly promoted cost sharing by such methods as increasing coinsurance and deductibles, increasing out-of-pocket maximums, shifting from in-patient to out-patient treatment, enhancing prescription drug tiering, and they have given members greater responsibility for their own health through such products as medical savings accounts. And goals for future product design, offered Benstetter, should include greater cost and choice visibility for consumers; greater provider information to enable the channelling of patients to the most efficient provider; and incentives for preventative measures, amongst other things. This comprehensive advice was rounded off with a look at some of the expected functions of a managed care programme, including network management and provider relations, and medical claims management, as well as some of the synergies of product design and managed care.

Thomas L. Hudson – General Counsel, Medex Global Group, Inc.

Giving a legal perspective on cost containment in the US, Tom Hudson illustrated some of the issues surrounding the discounting of medical bills, gave a run down of some of the players in the

market, and using factual scenarios and case histories, and showed some of the right and wrong ways to go about the process of cost containment. “If there is a discount, what is the legal basis for doing so? Is it a fair process? Does the provider know what’s going on? And is the patient being treated fairly?” began Hudson, highlighting some of the key issues for payers.Players in the market, explained Hudson, include PPOs, HMOs, and TPAs, as well as silent PPOs, stacked PPOs and PPO aggregators. The predominant difference between these types of player is those that have contacts with the hospital and those that do not. Hudson then explained some of the reasons why hospitals enter into agreements with payers, which include prompt payment, marketing benefits, but also steerage is an important aspect. From the patient’s point of view, the advantage of such a contract is essentially reduced costs, as out-of-network patients pay more. So, a large insurer can attempt to negotiate an individual discounted rate with a hospital it doesn’t have an agreement with, often requesting that the hospital does not attempt balance billing i.e. attempt to recover the discounted portion of the bill directly from the patient; or it can, and likely will, use a PPO discount through such a company that does have an agreement with the hospital. But, said Hudson, we’re getting to a point where PPOs are not just leasing their access to hospital discounts to other insurers, but are leasing their discounts to other PPO networks, who in turn lease their discounts to insurers. Healthcare providers, however, don’t want these ‘downstream’ payers; they prefer to know exactly who they’ve entered into a contract with. As Hudson explained, out-of-network care should be paid for as charged, i.e. without being discounted, but by using silent PPOs, insurers are paying even less that they would if they were paying for in-network care, and passing additional costs onto patients. In such circumstances where a discounted rate has been paid, several legal issues arise. In a disputed case, a court will look at the basis for taking the discount to determine if it was legitimate. It will look at such issues as mutuality of obligation (do both parties in the contractual relationship have the same or similar obligations?), the consideration that the hospital is being paid to give that discount, benefit of the bargain (what benefits is the hospital receiving from a silent PPO?), privity and breach of contract, the covenant of good faith and fair dealing and unjust enrichment. Using examples of these terms, Hudson then took the audience through several legal cases in the US where recoveries have been made from payers for improper discounts in a variety of circumstances, including cases that would make it easier to bring silent PPO cases to court. And, finally, he disclosed a rise in the number of collection agencies that investigate hospitals’ billing records to uncover non-contracted PPO or TPA discounts with a view to legally recovering such costs. “Depending on where you are in the payor chain,” warned Hudson, “you might find yourself with some potential risk of being a defendant or some potential liability.”

“…we’re getting

to a point where

PPOs are not

just leasing their

access to hospital

discounts to other

insurers, but

are leasing their

discounts to other

PPO networks…”

x CONFERENCEREVIEW


Is regulation necessary?The impact of Commission on Accreditation of Medical Transport Services (CAMTS) and the European Aero-Medical Institute (EURAMI) accreditation vs benefits

Dr Michael Braida – CMO of AXA Assistance, Germany

Michael Braida was first on the podium, giving his view on accreditation from the perspective of an assistance company. Braida is an intensivist working in a German hospital and has a

particular interest in accreditation, as he believes the air ambulance industry requires such oversight. Speaking of the early days of recruiting air ambulances, Braida outlined the simple questions he was usually asked, such as a carrier’s reputation, aircraft specification, equipment, range and evidence of insurance policies. Although good practical questions, in such a crucial industry, the questions that Braida believes should be asked need to confirm the reliability and reputation of air ambulance service, for example: “Is the air ambulance nationally accredited?” and “What is the company’s business case?” It is then necessary to take into consideration all the factors that contribute to a successful repatriation: whether the aircraft is owned and managed by the company or whether the flight is brokered; how the company’s safety records fare – is there any history of violations? Moreover, those involved in the missions and what qualifications they hold needs to be considered, such as those of the pilots and the transport team; has specialist training been undertaken by those that require it? Is there a medical director and what equipment will the team carry?; will this include a full complement of drugs, monitors and oxygen? CAMTS and EURAMI accreditations, he said, are thus important symbols in the industry.Looking at the development of the air ambulance industry, Braida was able to speak from direct experience, and he demonstrated a steady increase in the number of air ambulance flights undertaken on a yearly basis. The reasons for this rise, he said, include increased medical bandwidth, cost explosion and stronger client pressure. Also, whilst there is already an abundance of reputable suppliers, new air ambulance companies are now entering the market, increasing competition between them. Meanwhile,

AXA often finds that the companies it wishes to work with are already in the air, whilst others mostly have craft still on the ground – a scenario, says Braida, that speaks for itself. It makes sense, he continued, for assistance companies to work with reputable air ambulance suppliers that have accreditation, and as such: “AXA clearly sees accreditation as an indicator of a maturing industry.” Having said this, he also understands that air ambulance companies should not be overloaded with extra expenses and that accreditation has to make business sense: “We do not favour accreditation schemes that would create a new ‘expensive’ industry.” Moreover, he emphasised that accreditation will form a valuable support mechanism, but will never be a substitute for a good and trustworthy relationship between an assistance company and air ambulance supplier.

Louis Wright – Sales and Marketing Manager, European Air Ambulance

Louis Wright is at the helm of a new and important merger within the repatriation industry, overseeing the union of DRF and Luxembourg Air Rescue to create a new company: European Air

Ambulance. At present, he believes there are two different levels of air ambulance company in the market – those that are good and accredited, and the remainder. Giving an example of the current care quality in Europe, Wright showed a video of an unaccredited air ambulance company being filmed on a job in Warsaw by a French film company; the results of which were somewhat shocking. The unaccredited medical crew were witnessed struggling to get a stretcher with a patient into a tiny plane not designed to be used as an ambulance, with no rear loading possibilities just the regular passenger door. The problem is further exacerbated by the lack of assistance from the pilots, who are shown sitting in the cockpit unwilling to get involved. The patient is eventually thrust into the plane at a 45-degree angle and then secured into place with two straps. Further images showed medical equipment resting on chairs, none of which is strapped down. Wright also highlighted the fact that using an accredited air ambulance means no switching of business, and planes that are fully equipped to deal with medical emergencies around the clock.What exactly is achieved through accreditation? Looking specifically at EURAMI, the model of

accreditation used in Europe, Wright divulged its intentions to demonstrate the philosophy behind the accreditation agencies: “EURAMI will, within its area of special aeromedical knowledge, act as an advocate and fight for unable and needy emergency patients so that they can be provided with optimal and safe medical aid by air rescue and flight transportation when indicated Europe-wide, according to the uniform standards and internationally accepted scientific level, without consideration for age, sex, race, religion, social status and philosophy of life. The authorities in each respective country shall look for this specific form of socio-medical care.”Outlining the jurisdiction of both CAMTS and EURAMI, Wright explained that the main focus of CAMTS is North America, whilst EURAMI is active in Europe. Accredited providers in Europe so far, he said, include European Air Ambulance, REGA, Red Star and Norwegian Luftambulance. Whilst both accreditation systems focus prominantly on the quality of patient care, and are very similar in their basic concepts, each is adapted differently in order to take into account different legal structures in their respective continents. Each agency, however, views the other as its equivalent. In conclusion, said Wright, due to their different terrains, operating structures and the differing legal systems in which they operate, one agency could not replace the other.

David Bump – Vice President of Programme Development, Air Trek

David Bump began by asking: “Accreditation – what does this really mean?” Originating from Latin, it means ‘to give official authorisation or approval to’ or ‘to recognise or vouch for as

conforming within a standard’. Many industries already enforce standards for accreditation purposes, such as legal establishments, the fire department, pharmacies and universities. In a nutshell, said Bump, each and every product or service used to simplify our world is either regulated or accredited in one form or another. It is with this in mind that he asks why then should the air ambulance industry not be required to meet established standards and practices?In an ideal world, Bump suggests that the consumer would visit all the providers and view their assets – see what’s going on, meet with the fuel providers, the parts makers and so forth, but realistically, time does not allow for a personal visit and review of each

international air ambulance forum

“…air ambulance

companies

should not be

overloaded with

extra expenses

…accreditation

has to make

business sense.”

xiCONFERENCEREVIEW


service contracted out, so in lieu of that there should be an accreditation process: “The most consistent and often only means for providing an independent risk management and/or assessment of a product or service is to review their professional credentials, licensure, inspections and adherence to established standards,” said Bump. To explain CAMTS to those who are unaware, this body was created in 1991, initially as a means to address rotor wing aircraft safety concerns. Formerly known as CAAMS – Commission on Accreditation of Air Medical Services – it was the first industry standards agency to be established, and its guidelines are now revised every two to three years to address current issues of patient care and safety. Apart from setting measurable criteria for air ambulance providers, the main goals of CAMTS include the provision of an organised forum, the pursuit of accreditation for as many constituents as possible, and the provision of a voluntary and objective mechanism for the evaluation of compliance with accreditation standards. The US military, said Bump, also uses CAMTS as a benchmark for excellence. In Bump’s view, participating in the voluntary accreditation process is extremely important for air ambulance providers, not least because it enables services to verify commitment to quality standards not only for themselves, but their peers, medical professionals and the general public. Bump is careful to point out, however, that accreditation standards should be periodically revised to reflect the dynamic and changing environment of medical transport, with trained site surveyors physically reviewing programmes, aircraft, training and adherence to standards. There are three levels of accreditation within the CAMTS process, explained Bump, and it can take action if rules are not adhered to.

Working practice and flying times for medical crewsLooking at the financial and practical implications of restricted hours

Dr Chris Idzikowski – Doctor, Edinburgh Sleep Centre

Chris Idzikowski’s presentation outlined the factors that impact upon mental performance and efficiency, and how much tiredness really affects a person’s ability to function. When one is sleep-

deprived, he said, concentration and vigilance are affected. In fact, he compared the effects of one night’s sleep deprivation to that of many countries’ legal drink-drive limits. Stereotypical and ‘preservation’ responses will continue to be applied by a sleep-deprived person, even if their situation has changed and demands a different response; this is because the effects of lack of sleep are subtle, and will not alert a person to the

need to alter a stereotypical response. The longer a person is awake, the more pressure exists for sleep, and this need is exacerbated by the natural body temperature curve, whose biggest dip occurs between three and five in the morning. So, if a person stays awake beyond four in the morning, this 24-hour cycle will enable the person in question to retain some alertness as body temperature starts to rise, but it will never return to the level of someone that has slept all night. This brought into the discussion the idea that doctors working at night should pay higher insurance premiums. Idzikowski then further detailed the power that the 24-hour biological clock has to control many aspects of the body, including sleep, alertness, muscle efficiency, joint flexibility, short-term memory, mental performance, kidney output and appetite hormones. The consequential long-term sleep problems or disorders that can result from lack of sleep, he said, includes sleep apnoea – a major problem associated with obesity, diabetes, daytime sleepiness, hypertension, heart disease and stroke. Insomnia and hypersomnia have also been linked to depression. In terms of mental performance and alertness, those who are better trained to manage with less sleep are more likely to cope in such circumstances, but physical factors dictate that the duration of prior wakefulness, plus the effect of the circadian clock, mean that the worst time for alertness for everyone, regardless of training, is between three and five in the morning. When linked to the regulation of pilots and medical crew, Idzikowski suggested that from anywhere after 16 hours wakefulness there will be a decline in alertness, but the 24-hour clock process will also have an effect, meaning that a decline will also be experienced after 10pm. Talking operationally, Dr Idzikowski went on to advise that the best way to manage when working long shifts is to take naps, where possible, to help counteract the effects of long-term wakefulness: “Build up sleep – say when en route to pick up patient. Put together a strategy of how to cope, rather than say that is when you’ll stop working effectively.”

Sean Culligan – Operations Director, AMREF Flying Doctors

Sean Culligan works in Africa, a continent four times the size of the US: Kenya is twice the size of the United Kingdom and Sudan is the size of Western Europe. Despite it’s might, Africa, said

Culligan has poor infrastructure, limited financial resources, regional political unrest and a huge lack of standards and regulations. As a result, it is often a difficult terrain to work in, but anyone who wants to set up as an air ambulance operator can and will, he said. Culligan, hence, views it as important to adhere to EURAMI regulations as a way of measuring standards.

In many parts of Africa, told Culligan, there is no such thing as air traffic control, and of over 1,400 possible landing strips in Kenya, only eight have tarmac and only two have 24-hour operations. He went on to show a number of slides highlighting some of the particular difficulties AMREF faces on a regular basis – including airports with very basic landing strips that are sometimes waterlogged, and sometimes on such acute angles that only certain aircraft can reach them. Generally, he explained, the Cessna Caravan is the only aircraft that can reach these destinations, but with an unpressurised cabin, it means that if it is 39ºC outside then it is also 39ºC inside. The ride will be hot, bumpy and enormously tiring: an environment that will not allow for sleep – not even power naps! Meanwhile, it is essential that the most is made of daylight hours, as so many bases are not accessible after dark. To add to the already unfriendly conditions, the crew has to get up at dawn (around two or three in the morning), when it is already warm, to maximise use of daylight hours.Whilst the flight crew is legally limited to 14 hours flying time, the medical crew has no such legal restriction. Inadequate rest, however, has been proven to cause errors of judgement, and with six to eight landings in a day, one can see how alertness will be worn, further exacerbated by physical conditions such as unpractical landing bases or having to deal with wild animals suddenly appearing on the dirt track that makes up the runway. Medical crews are, despite the problems they encounter, still expected to be fit and alert in order to assist the patient once the flight has arrived at its destination. Furthermore, intercontinental flights from Africa to Europe are predominantly carried out overnight, explained Culligan, as Europe is best equipped to receive units that arrive from around 6am.With reference to the future, Culligan commented: “It would seem prudent that duty time regulations for flight medical personnel are introduced in the same way as those regulations governing flight deck crew.” But, he continued: “There will be a cost implication for the client – the insurance or assistance company.” Extra medical crews will result in extra costs for these companies, although Culligan made it crystal clear that these regulations are already viewed as a necessity by most air ambulance operators.

Dr Michael Churchill-Smith – Medical Director, Skyservice Aviation

In discussing flying times for medical crews, Michael Churchill-Smith highlighted the differences between primary and secondary medical care. He talked about the immediate need

to repatriate someone when a life is in danger (primary care) compared to secondary care, when there is a different degree of stability involved in the patient’s condition. To try to compare one against the other, he said, is impossible and an unfair comparison. In an area such as sleep, where solid, objective information is lacking, Churchill-Smith advised the use of the term ‘guidelines’ as a much safer and more comfortable word. It implies more reason and flexibility than ‘standards’ when looking at a situation where variable conditions are the norm. The measures Churchill-Smith hopes will be implemented, however, include controlled rest and the use of teams in order that energy levels are played off against each other in an attempt to optimise wakefulness. He also suggests trying to limit consecutive international transports, whilst sharing the medical tasks amongst

the medical team available on the plane, in order that everyone has a chance to rest where possible. He sees these as reasonable guidelines that will go towards alleviating errors of judgement that may result in medical or aviation disasters. In terms of the future, Churchill-Smith is a strong advocate of research, believing that proper data collection will enable objectivity. His finishing comments cited a future that lies in an emerging world of stimulation systems: “These are found in universities. [They are] a series of computer-based, digitised systems, which when hooked up enable

stimulation systems to analyse the staff that are lacking sleep and to implement variables in order to see and measure the effect.” Finally, there is also the question of who will police the policemen and the providers. Because, ultimately, according to Churchill-Smith, people are in this business to make a profit and they will choose the options that will make them money. In order to successfully merge aviation systems and medical systems – a step that he believes is necessary -– one needs to look to the aviation industry, which is a commercial, for-profit industry: “They have had to put in regulatory systems for their pilots, so why not look to them to ensure that a body comes together, possibly continent to continent, to set minimum standards that are currently the best practice – with enough reasonableness to take into account the differences.”

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Cost versus quality, and global pricing

Abhijeet Sachdev – Vice President, Privat Healthcare

Abhijeet Sachdev opened his presentation by stating that the quest for high quality healthcare has become universal, but that broad definitions of quality cannot be applied due to the differing socio-

cultural contexts that are apparent in the global industry. Thus, what constitutes quality care in India may differ vastly to standards in the UK or US. Furthermore, quality healthcare is no longer determined purely by the professionals and institutions that administer the goods and services, as industry-savvy patients now require healthcare to not only be comprehensive, continuous and personalised, but they are increasingly demanding a response to their specific needs for wellbeing. Sachdev continued: “To achieve high-quality healthcare, it is necessary to encompass the technical criteria set by the healthcare trendsetters, the comfort level set by consumers, and quality and cost control set by health insurances.” It is also necessary to examine the impact that globalisation is having on healthcare. For example, specialisation in healthcare frequently results in more costly procedures, but it comes hand in hand with a general increase in access to health services due to socio-demographic changes. These changes are, however, being interpreted in a variety of ways across the world: for example, improved access to the Internet has allowed customers to develop better expectations for their quality of life and wider access to information. This, in turn, has increased demands from individual consumers in countries such as Thailand, where patients and relatives, said Sachdev, now expect five-star hotel standards in their hospitals – a clear effect of medical tourism, as this is not the case in Europe – and they like to choose where they get treated, all of which is pushing up costs. How then can healthcare policy-makers and providers concentrate on cost containment without compromising on quality? And how is that quality defined? According to Sachdev, high-quality healthcare should make use of evidence-based data appropriately, which means taking into account social, cultural and consumer expectations. In global terms, the ideal solution would be for East and

West to define a universal set of standards including quality deliverance, transparency, costing, pricing, equipment, education and management. This is something that Sachdev believes could be possible. Moreover, an accreditation process would define procedures, methodologies and institutionalisation, all of which contribute towards quality standardisation. But according to Sachdev, even if a universal standard for quality of care could be achieved, this would not necessarily lead to a standardisation of costs. Costs differ everywhere and there are hundreds of factors that need to be taken into account. As a solution, however, Sachdev suggested that there should be some sort of accredited body to give out standard information with regards to costs. Then, giving an example of the situation in India, Sachdev described an obsession with brand consciousness and a desire for hotel-style hospitals, as opposed to small clinics that can offer just as good service. With 75 per cent of healthcare in India belonging to the private sector, it is a business-led industry that exists to make a profit. In terms of insurance, out-of-pocket payments continue to dominate in India, although there are increased numbers of claims for Mediclaim and new health plans being launched. Nevertheless, according to the speaker, private health insurance companies set the cost structures. In conclusion, Sachdev detailed the quest for relevant care, quality care and cost-effective care as being universal, as societies at every level of the socio-economic chain adhere to these same basic fundamental principles.

Robert Rodriguez – Operations Director, Baptist Health International Center

Robert Rodriguez opened his speech by outlining the very sensitive nature of the issue of costs, and the many different aspects of it, all of which come with different opinions as to what costs and quality

actually are. Quality, he stated, can be defined as being fundamentally relational: “It is the ongoing process of building and sustaining relationships by assessing, anticipating and fulfilling stated and implied needs.” In terms of healthcare, he said, it is the degree to which health services for individuals and populations increase the likelihood of desired health outcomes and are consistent with current professional knowledge. Quality is thus controlled through the positions of hospitals and insurance

companies: they are the ones who dictate what makes quality exceptional or otherwise. In terms of costs, US$1.9 trillion was spent in the US on healthcare in 2004, or $6,280 per person, double the amount spent on defence. This expenditure accounts for 16 per cent of the Gross Domestic Product (GDP) – in Switzerland, this figure is 10.9 per cent and in Canada it is 9.7 per cent. And expenditure is expected to continue rising for the next decade, reaching levels of $4 trillion by 2015, or 20 per cent of GDP. Most employers in the US will go bankrupt if these figures continue, stated Rodriguez, as they will be unable to keep up with the costs. One of the driving factors behind these high costs is medical innovation: as technology increases, so too does cost. Mr Rodriguez is the first to admit that a benefit of his particular place of work is that it is one of the top quality hospitals in the country, and that it is responding to the dem and for technology to keep loved ones alive (27 per cent of Medicare’s $327 billion budget went to keeping patients alive in their last year). There is also an ever-increasing demand for treatment for conditions that our grandparents would merely have tolerated. The problem is further exacerbated because we don’t pay for what we consume, said Rodriguez; especially in the US, the insurance company takes care of the bill, so the consumer has no clear idea of what the costs are, which is why it is difficult to get them interested in the subject. There is also no capacity for cost competition as there is no comparison available – no essence of window-shopping. Add to this our longer lives, coupled with increasingly unhealthy lifestyles and the problem seems expansive. In global terms, the world is becoming flatter as we see the true globalisation of healthcare, said Rodriguez, particularly with the onset of medical tourism. An example of this is Blue Ridge Paper Products Inc. in North Carolina, which is now pushing all employees to get healthcare in India, saving themselves a percentage of costs, which will then filter down to the employees. Mr Rodriguez then went on to talk of an inherent belief that quality is an entitlement and prerequisite to healthcare, so consumers will pick the best doctor not the cheapest, especially when they aren’t shouldering the cost. In his summary, Mr Rodriguez showed that consumers need to understand how much money is changing hands, as currently they demand quality care, but rarely understand the financial implications. Moreover, technology will continue to redefine quality in healthcare and as that grows, so will costs. Ultimately, there needs to be increased fiscal

accountability for consumers for both costs and savings.

Dave De Loose – Head of Provider Relations, Vanbreda International

Dave De Loose entered this lively debate with a graphic description of the stark contrasts that exist in healthcare today, describing what happened when he was taken on a tour of a hospital in

Bucharest. En route to the private wing of the hospital, he first walked through the corridors of the state-operated section, where he witnessed four to five beds pushed together with eight or nine people lying on them, covered by just a few blankets, no sign of doctors or nurses, and a plethora of beggars in the corridors. At the end one large corridor was a big glass door with armed guards protecting it. Through these doors he entered a white marble hall with leather sofas and several private rooms, all equipped with satellite television and fridges; the only thing missing was the patients. Even within one hospital building, he said, costs differ depending upon which side of corridor you are on, as does the quality. De Loose then cited the increasing number of private initiatives that are starting up around the world, overall raising not only quality of care but also costs. In more specific terms, these private clinics impact upon spending awareness, as for example in the UK, where by choosing to pay for care himself, the consumer has a better understanding of the costs involved.Further addressing healthcare costs and quality on a global scale, De Loose then said that four important questions need to be asked: What do you want? Where do you want it? How do you want it? And when do you want it? But the question that makes these other questions easier to answer is: How often will you need it? He then presented a list of invoices from Asian countries with figures varying so massively that it is nearly impossible to measure quality when there is such a vast difference in cost. Take the Philippines, for example, where the lowest cost of a particular treatment comes in at $98, yet the highest cost is $3,654.So how, as a payer, can you have influence over treatment? The answer, according to De Loose, is to have an ongoing process of quality assessment. It is vital, he said, to have a clear picture of the quality of the provider and price negotiations. This comes

international private healthcare sessions

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down to collecting as much information as possible, thus increasing the buying power of the one paying the hospital or doctor bill. Without time to negotiate, it is important to make agreements beforehand, but it is also very important to work out volume – ask ‘how often will procedures be carried out?’ Moreover, try to discern the difference between a high price and a high cost, as the more information one can ascertain, the more experience one gains, and the better you will recognise influencing factors the next time round. Try to know your competition is another suggestion offered by De Loose, in order to increase your buying power: knowing the local climate will be invaluable, and knowing what alternatives are available will influence your buying process. Overall, however, De Loose sees the key to improvement as being cohesive, accurate information.

Cost containment: what are the advantages of overseas dental care?

Thomas Antalffy – Partner, VitalEurope

Thomas Antalffy offered a great insight into dental tourism, looking specifically at Hungary. With 10,000 searches per month on Internet search engine Google in relation to dental tourism, its

growing popularity cannot be denied. In the UK, for example, the National Health Service (NHS) is heavily oversubscribed, so now it predominantly only covers emergency dental treatment, rather than elective surgery – such as implants and veneers – which is the most popular type of treatment. This

trend has pushed people to seek out private dentistry solutions – not just at home but, increasingly, abroad.Over 50 per cent of overall surgery costs in the UK are for dentists’ fees alone. Showing us EU statistics on various dentists, Antalffy illustrated the high level of dentists’ salaries in the UK, showing they earn more than dentists in any other country in Europe except Switzerland, Denmark and Germany. Thus, the possibility of making savings of up to 75 per cent shows there is a lot to be said for travelling abroad to receive dentistry treatment. Furthermore, implants in the UK cost anything up to £2,000, whereas in Hungary they can be done for £500, another huge economic driver for overseas treatment – something that has, in fact, been taking place for the last 30 years but that has been further enhanced with the onset of budget air travel. Currently, the phenomenon is for dentistry ‘agencies’, explained Thomas, and these companies are able to drum up more business through enticements, including toll free numbers, UK consultations, airport pick-up, hotel bookings, sightseeing and wellness activities. In fact, the trip is often billed as a package holiday, with a treatment thrown in. Popularity for such trips is already high in the UK, with 1,000 dental tourists travelling abroad for treatment every month (besides Hungary, Switzerland and Denmark are also popular), clocking up an annual spend of £20 million. The market is not just constrained to dental surgery, however, with medical tourism also undertaken for eye correction surgery, cosmetic surgery, joint replacement surgery, artificial limbs and In-Vitro Fertilisation (IVF).One of the benefits to health insurers of this type of medical tourism, concluded Antalffy, is its ability to offer reduced wait times and specialist treatments, as well as enhanced cost containment. Although, he said, insurers should note that it is not always easy to encourage a patient to travel abroad just to save them money, as the patient may not be willing to participate in inconvenient travel, especially if they have been with the insurer for years.

Emerging markets: developments in Eastern Europe

Andrew Apps – Sales and Marketing Manager, Goodhealth Worldwide

Goodhealth Worldwide (Europe) Ltd is enjoying success currently, with business growing in most eastern European countries, including Bulgaria, Croatia, the Czech Republic, Estonia,

and Hungary. According to Andrew Apps, the new Eastern market has only been around, from a business point of view, for the last 16 years, but over the past 10 years, most Central and Eastern European (CEE) countries have exhibited strong economic growth, almost independent of, and some times in spite of, the politics of the ruling party. Despite the dramatic changes that have boosted this region, cultural and financial differences still exist, and wage levels lag behind the rest of Europe. Croatia has the highest monthly average wage at US$1,050; where Ukraine’s monthly average is still just US$156, even though they are both increasingly successful and stable countries.Current trends across CEE countries, meanwhile, show an inevitable increase in the importance of non-governmental funding. In the past, governments were responsible for everything, now however, we can see four key messages emerging, said Apps. Firstly, there are the changing methods of financing: from central budgetary control to centralised insurance-based reimbursement systems, which has enabled the successful emergence of the private sector; an increasing acceptance by the populace that public systems will remain under-funded, but will be complimented by private funding and insurance; an

increasing awareness of western healthcare, leading to a greater demand for an accessible, humane and affordable healthcare system; and finally a gradual increase in life expectancy to Western European levels, which will substantially increase the demand for healthcare. Without the necessary funding to cope with these increasing levels, however, insurance companies are entering the fray.Apps then revealed a growing expatriate market, with huge numbers of Eastern Europeans moving abroad to live and work in other countries, such as the UK, Sweden and Ireland. Further counties being added to the EU, he said, will make for an even greater expatriate healthcare market.In terms of emerging markets, there is clearly a growing private healthcare sector in Eastern Europe, which, according to Apps, is suppressing the historic and damaging market practice of charging ‘success fees’. And as 98 per cent of healthcare is privately funded, there is enormous potential for private sector insurance: “Whilst the growth of private medical insurance within the CEE lies largely with [political] healthcare reform, other drivers can accelerate this process,” he said. These include overall growth of an economy, tax systems treating PMI as a deductible item, the existence of well developed networks of high standard medical healthcare providers, and education of the local population with regards to responsibility for personal health. Aside from the traditional expatriate, there are three basic local market segments to consider, continued Apps, giving advice on underwriting for each: the public/social sector, the emerging middle class and high net worth individuals. In terms of the private medical insurance sector, he concluded, most local insurers offer some form of private medical insurance but only with limited coverage, whilst international companies usually operate ‘remotely’, through agents serving western expatriates, rather than developing local markets systematically. Thus, the local sector remains at a standstill, but on the plus side, Poland is leading the way with regards to financial services. The revolution has begun.

On Thursday night delegates were treated to a relaxing jazz river boat cruise by Dr Colin Plotkin Consulting and European Air Ambulance. Taking in the most treasured sights of the city, attendees partied into the night to the sounds of a five-piece jazz band. Thanks to a broken lock, partygoers didn’t quite get the return trip they were expecting, but everyone was delivered safely back to the hotel eventually and, as you can tell by the photos, they had a wonderful time!

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Licensing to sell in a foreign country

William Yonge – Partner, McDermott Will & Emery

William Yonge offered his extensive knowledge and experience of health insurance licensing in foreign countries, and began the session with an overview of US, European Union (EU) and

UK health insurance regulation. In the US, licences are required to engage in the business of insurance, particularly on a state-by-state basis: “In most states, both the broker and the insurance provider must be licensed in the state – a licensed agent or broker cannot sell insurance from an unauthorised provider, but there is no definitive test for determining when state insurance laws apply to an alien insurer. Most states permit offering limited coverage to non-domiciles temporarily residing in the state,” he explained. Just to make the situation slightly more confusing, the definition of ‘business of insurance’ varies in different states. Yonge then delivered his guidelines for assisting alien insurers to avoid state regulation in the US. These refer to the domicile of the insurered: “State laws may not apply if the insured is not domiciled in the state and the underlying insurance transaction is effected outside the state.” There is, he said, no uniform test for ‘domicile’. Other things insurers should bear in mind are location of the contract formation, methods of contact between the insurer and insured, and the scope of insurance statutes.Yonge followed on with an extensive overview of the European regulation of health insurance, illustrating the EU insurance directives’ aim of harmonising laws across member states. Then, taking a look at the UK regulation of health insurance, he outlined the responsibility of the Financial Services Authority (FSA), the main source of insurance regulation in the country, and continued by discussing other financial and capital requirements. As he showed, the FSA oversees the sales and marketing of insurance products, while reporting requirements are regulated by the Insurance Regulatory Reporting Instrument. ICOB rules are requirements relating to the business processes involved in selling and administering insurance: authorised insurance companies must provide potential customers with a full explanation of policy details, such as the benefits payable under the policy, definitions of any words or phrases used, cover available for pre-existing medical conditions, arrangements for making and paying claims, and the

fact that premiums and coverage may vary for all policyholders. Meanwhile, PRU capital requirements ascertain the detailed prudential requirements for insurers and insurance intermediaries, and require that firms hold ‘such financial resources in order to be able to meet its liabilities as they fall due’.

Full Medical Underwriting versus Moratorium Underwriting

Carl Carter – Managing Director, IMG Europe

First up to debate the benefits of both of these policy types was Carl Carter, who began by outlining IMG’s policy of primarily practicing a full medical underwriting (FMU) approach,

highlighting the 12-year term underwriting relationship it holds with Sirius International Insurance Corp. Carter described FMU as ‘a method of assessing a medical insurance risk so as to determine its acceptability to underwriters, based upon a prospective applicant filling in a form and making a declaration of their medical history’. “Further medical information or reports may be required from the applicant’s doctor,” he added. After this, a decision can be made whether to accept or decline the risk, whether to apply any additional premiums or exclusions or whether a higher premium may make the risk acceptable. The benefits that a customer can derive from this includes: a clear understanding of which conditions are or are not covered; and the ability to cover certain conditions after set-periods. For the underwriter, the ability to apply terms or additional premiums to make risks more acceptable is appreciated. The best thing about FMU, in Carter’s opinion, is that it is proactive and shows both parties have reached an informed decision.FMU is not without its disadvantages, however. Both the underwriter and the customer may have to put in more work without the guarantee of acceptance, and the customer may have to pay to obtain a medical report, which may also cause delays.Moratorium in comparison can be good, according to Carter, but it too has its drawbacks. Whilst FMU ‘assesses’ the risk, moratorium underwriting ‘accepts’ the risk, often with minimal or no medical history, relying instead on a blanket rolling exclusion period. Whilst good for the customer because it is quick and easy to apply for cover, the disadvantage is that many customers misunderstand the concept, being less

aware of how a medical condition may affect their cover. Moreover, if the policy is mis-sold, the client could be paying a premium for a policy that is virtually worthless, and some insureds have been known to deliberately delay seeking medical advice in order that treatment would eventually be allowed. Benefits to underwriters of moratorium underwriting are that this type of policy is easier to sell, and less technical ability is involved at the application stage. But its disadvantages are plentiful and include difficulty in keeping track of what is on risk, and a greater number of disputed claims.Carter concluded by stating that both types of underwriting have their place. Moratorium is common and easy to use, but also commonly misunderstood; where FMU provides a better clarity of cover and matches the needs of both underwriter and client.

Sarah Dennis – International Sales Manager, Norwich Union Healthcare

Sarah Dennis began by describing how Norwich Union carries out medical underwriting. It accepts three types, she explained: FMU, CPME (Continuing Personal Medical Exclusions) and

moratorium. FMU enables the insurer to know what risk they are undertaking, but it also enables the insured to know of any medical exclusions present at the commencement of cover, preventing any grey areas. Norwich Union also includes a cooling off period, which applies should the member be unhappy with exclusions applied to their policy. This helps prevent delays on claims payments, and, by not covering pre-existing conditions the insurer does not have to pay these claims, which results in less of an impact on the claims fund. Continuing Personal Medical Exclusions involves the client switching to a new policy or insurer, with the same underwriting terms, whereby the benefits and exclusions are continued as they were in the previous policy. The benefits, explained Dennis, are the same as with FMU.Analysing moratorium underwriting, Dennis highlighted a lack of gatekeeper GPs in most countries, which means insurers are unable to obtain a reliable history of condition. Claimants can also easily consult a new practitioner and will not always mention this on their previous history. Abuse of the policy is also possible, by deliberately consulting a different doctor and not then declaring a certain medical history. And it is more than possible that some insured members probably do not satisfy the

moratorium but know the policy well enough to get around this. To summarise, in the opinion of Dennis, fully medically underwritten policies are the best way to provide the clarity required for the insured and the insurer.

Andrew Sandilands – Sales and Customer Relations Manager, InterGlobal

Andrew Sandilands took a slightly different approach in this debate, speaking in favour of moratorium underwriting. Defending this method, he began by outlining its advantages, followed with its

perceived disadvantages, and highlighted that the choice of underwriting methodology it is not always black and white. He made it clear there are cases for both systems, and that ultimately the policyholder is given the choice of which way they would like to proceed. Moratorium underwriting always offers guaranteed acceptance, said Sandilands, whereas FMU may decline the business altogether. The simple underwriting involved in moratorium is important, as the client understands exactly what they’re buying, and for the insurer, the policies are quick and easy to sell. Also, there is no permanent exclusion of pre-existing conditions, and no premium loading. Sandilands further explained that there is generally no definite moratorium per se on a medical condition, but in actual fact, there is a rolling period of two years where the insurer won’t provide cover: then, if the complaint hasn’t resurfaced in that time, the condition can be reinstated in the policy. Acknowledging the disadvantages of moratorium underwriting, Sandilands said that although the policy is underwritten at point of claim, these two processes tie in very closely. He also emphasised that criticism and possible conflict with regards to claims tended to concern the way in which a policy was sold, not the moratorium itself. Exceptions to the rule when it comes to moratorium underwriting are older applicants, who are more expensive to treat; those switching from a previous insurer, who will always be asked a few limited questions by the new insurer; and those who want to know if a specific condition will be covered. In conclusion, Sandilands stated: “Whilst full medical underwriting may be appropriate in specific circumstances, moratorium policies offer a quick and efficient method of underwriting new business. This benefits both the insurer and the insured.” Finally, he stated that to offer true customer service, a choice of underwriting is perhaps the way forward, as long as it is delivered with sound, quality and unbiased advice.

The hotly contested quiz was held throughout a three-course buffet dinner, which was rounded off with traditional Czech entertainment.

Delegates at this year’s event enjoyed a fun quiz night and dinner at the host hotel, courtesy of OneWorld Assist.

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The table football tournament was again a popular event this year. Hosted by regular sponsors Stones Solicitors, teams battled it out for the top spot, which was eventually taken by Volker Lemke and Ian Cameron after a close-fought contest. The prize money was donated to AMREF Flying Doctors.

2nd InternationalTable Football Tournament

After-party sponsored by Canadian Global Air AmbulanceFollowing the ITIJ Awards ceremony, attendees were invited back to the Hotel InterContinental for an after-party courtesy of Canadian Global Air Ambulance. Revellers danced the night away and tried their hands at the casino offerings. A fantastic evening was had by all!

All photos from the conference sessions in Prague, as well as the social events and ITIJ Awards ceremony, can be found on the delegate Media Disk, as well as at www.itic.org.uk through ‘Interact’.

14th international travel insurance conference · with the new agenda format, which saw travel...

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