With the world becoming increasingly interconnected, many UK citizens are choosing to work and live abroad on either a permanent or temporary basis. What many of these people do not realize, however, is that moving abroad will often invalidate their UK life assurance policies. Most UK providers refuse to honour claims if the deceased person was living overseas at the time of his or her death. With the number of UK expats steadily growing, this problem is becoming more important for a greater number of people. To address these concerns, this article will look at why expats need life insurance and how they can go about getting it if they decide to move to a foreign country.
Is expat life insurance necessary?
Most UK insurance providers stipulate that the policyholder must be living in the UK for at least six months out of every year. For those who are abroad for longer than that time, expat life insurance is absolutely necessary. This fact is particularly true for those who are either the main breadwinners of the family or who have a mortgage in the UK that still needs to be paid off. Without adequate life cover, the deceaseds family could find their quality of life significantly diminished to the point where they may even have to declare bankruptcy. Furthermore, many people fail to consider the funeral and death costs for those living abroad. Surviving family members will often need to transport the body back to the UK, in which case they will need to contact the UK consulate in the deceased persons country of residence in order to get in contact with a specialist who can arrange for the bodys transport back to the UK. These services are not cheap and they will include, typically, embalming the body in the country of death, a zinc-lined coffin, air transport, and translation services. Even those who choose not to bury the body in the UK will still have to face the cost of funeral arrangements abroad, which will also include negotiating through unfamiliar laws and paying for translation services, as well. As such, expat life insurance is necessary for making sure a persons family is not put through greater financial strain than was originally anticipated.
Finding expat life insurance
In some cases, it may be possible to negotiate with a current provider to extend coverage while abroad. This is especially true if the person is moving within the European Union or to the United States. Even then, however, premiums are likely to go up significantly. Furthermore, most UK providers will provide no coverage for those living in most other countries, especially those considered particularly dangerous such as in the Middle East. For those moving to countries outside of the EU or the United States, they will likely have to visit a specialist or international provider. A specialist provider can cater to the unique needs of expats, but it is still important to know that certain causes of death may not be covered even by a certain specialist providers. For those that are moving to a particularly volatile region, for example, many providers will not pay out in case of death due to war or revolution.
Furthermore, international providers tend to calculate premiums based on statistical averages of deaths abroad. This can work out to mean averages are relatively cheap for those living in highly dangerous countries, but it also means that those living in even seemingly peaceful countries could be stuck with premiums that are rather high. As with any life insurance policy, it pays to shop around for the one that is not only the cheapest, but also provides the best value for money. Another option is to take out a policy in the country the person is moving to, although this is not often recommended as navigating local laws and terminology can at times be baffling, and the cost of translation services may render the initial savings obsolete. Furthermore, the cover offered will often be significantly less than what is provided by a UK company.
Living abroad can be exciting, but it also tends to be much riskier. For this reason, UK insurance providers are usually reticent about providing life assurance to UK expats. To be assured that they are adequately covered, such expats are best researching the insurance options available to them from a variety of specialist and international providers.
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