What kind of business travel insurance do I need? This is a common question for businesses because there are two types of insurance coverages that are similar: Business Travel & Accident Coverage and Foreign Voluntary Workers Comp. Most U.S. workers’ compensation policies will provide employees with a basic level of protection if they are injured while traveling outside the United States on business. But, oftentimes the coverage may not be enough to cover some of the expenses that can arise when employees travel to foreign countries.
Potential Business Travel Risks
When traveling on business to foreign countries, employees face a number of potential risks. While travel to lesser-developed parts of the world may involve an increased risk of illness or accidents, business travelers can become injured or sick even in major Western countries.
Here are a few examples of risks:
- Auto accidents – One of the most common causes of injury for business travelers
- Illness – Food poisoning or other travel-related problems
- Infectious Diseases – If you are traveling to a more remote country, the risk is higher
Create a comprehensive travel plan
To prepare your company for any of the risks you may face, it’s important to have a comprehensive plan in place before something goes wrong. Businesses can provide their employees who travel outside the U.S. with additional protection by purchasing foreign voluntary workers’ compensation and a business travel accident policy. Understanding the differences between foreign voluntary workers’ compensation and business travel and accident coverage is key to making the best choice for your business.
Foreign Voluntary Workers Compensation
Foreign Voluntary Workers Compensation (FVWC) insurance provides 24-hour coverage worldwide for work-related injuries. It also includes repatriation expense coverage, which are expenses to repatriate an injured or sick employee to their home country, along with travel assistance.
Here are the most common situations where FVWC may apply:
- Short-term business travel for covered employees.
- Long-term assignment outside the United States for covered employees.
- Travel outside the country of origin (the US or another country) for covered employees.
Business Travel & Accident (BTA) Insurance
Business Travel & Accident (BTA) Insurance is focused on providing worldwide accident and death protection, some medical coverage, and emergency medical and travel services.
- Provides Accidental Death & Dismemberment (AD&D) benefit
- Ancillary travel benefits
- Extends coverage to personal excursions
- Coverage for delayed or damaged baggage
Similarities between the two
There are some overlaps between FVWC and BTA insurance which can add to the confusion about the two. Both types of coverage are beneficial for companies that have international exposures like travel, operations, or subsidiaries.
Differences between the two
The main difference is BTA insurance provides an Accidental Death & Dismemberment (AD&D) benefit, similar to life insurance for business travel, and some ancillary travel benefits. It also extends the coverage for personal excursions either at the end or beginning of the business trip. There is also some coverage for delayed or damaged baggage. The latter benefits are important for employees based in Europe and Asia. In the US, homeowners’ insurance policies cover personal property worldwide.
Now that you can see the differences between the two coverages, it does make sense to get both for many businesses. A number of our clients with international exposures (travel, operations, subsidiaries) usually end up purchasing both of these policies. The bonus here is that premiums for both FVWC and BTA are fairly economical.
Customizable options available
In short, think of FWVC as 24-hour, international coverage for work-related injuries or accidents. On the other hand, think of BTA as additional coverage on top of FVWC for business, and accompanying personal, travel-related injuries resulting in death or dismemberment and some personal property coverage. For more information, go HERE. Please contact us if you want to explore these coverages further and want additional information.