A Year Overseas: What to Do with NZ Health Insurance

If you are planning to live overseas for a year, reviewing your New Zealand health insurance is a sensible part of preparing your budget. Should you keep paying premiums while you are away, or cancel and buy another policy when you return?

If you intend to return to New Zealand, check your existing policy’s overseas suspension and reinstatement rules before deciding. Consider both the cost during your absence and how your healthcare cover will continue after your return.

Buying a new policy may mean different terms

Cancelling ends your existing cover. A new policy is subject to the application requirements and terms that apply at that time. You should not assume your previous cover will automatically be restored.

For example, applications for nib Ultimate Health and Ultimate Health Max involve a health questionnaire. Symptoms, abnormal test results, medication or diagnoses arising during your year away may be relevant to a new application.

Before cancelling, ask what your existing policy already covers and how a change in health might affect a future application. Being healthy today does not guarantee that you will qualify for the same cover in a year’s time.

Check the overseas suspension options with AIA or nib

Some health insurance policies allow eligible insured people to suspend their cover and the associated premiums while overseas, then resume cover under the policy’s rules. Arrange this with your insurer rather than simply stopping payments.

AIA Private Health wording provides for requesting suspension for overseas travel of up to 24 months. Notification, supporting evidence and written acknowledgement requirements apply.

nib’s official comparison for Ultimate Health and Ultimate Health Max states that, after 12 months of continuous cover, overseas travel or residence suspension is available for up to 24 months.

These examples show why it is useful to ask about suspension before cancelling. Eligibility and reinstatement requirements vary by product and policy version.

Get written confirmation of the suspension dates, the insured people affected, premium arrangements and the procedure if you return early or stay longer. If other people on the policy remain in New Zealand, ask whether only your cover can be suspended.

Understand what happens during suspension

Suspending cover generally means that the suspended insurance does not provide protection during that period.

For example, AIA Private Health wording states that the relevant premiums are not payable during suspension and that claim events occurring during suspension are not covered. Reinstatement requires premium payment within the timeframe specified in the policy.

Ask how a medical condition arising during suspension would be treated if you need treatment after cover resumes. Do not assume it will either be automatically excluded or automatically covered.

Waiting periods and premiums also need attention. For example, nib Premium Hospital wording states that suspension does not count towards waiting periods. Any unfinished waiting periods must be completed after cover restarts. If the policy renews while suspended, an increased premium may apply when it resumes. These are provisions of that product and should not be applied automatically to other policies.

Arrange healthcare protection in your destination country

Keeping your New Zealand policy active does not automatically cover routine consultations, emergency care or hospital treatment in another country.

For example, nib Ultimate Health Max includes overseas treatment benefits such as its Medical Tourism Benefit. These benefits have specific eligibility and reimbursement rules; they should not be treated as comprehensive medical insurance for a year living overseas.

Review the healthcare protection available where you will live and whether you need additional insurance suitable for an extended stay. If you consider travel insurance, check residency requirements, maximum trip duration, destination cover and pre-existing condition terms. An annual policy does not necessarily cover one continuous year abroad.

Choose according to your return plans and circumstances

If you have a clear plan to return after a year, check suspension eligibility and compare it with keeping your policy active. Review the value of existing cover carefully, particularly if you have health conditions or favourable policy terms.

If suspension is unavailable, ask whether changing your excess or optional benefits would suit your budget. Confirm what would be required to reverse those changes later. For example, AIA Private Health wording allows a health assessment when requesting a lower excess.

If you plan to settle overseas indefinitely, cancellation may be appropriate after reviewing the consequences and arranging suitable protection for your new circumstances.

One Step Finance can help you review your existing policy, compare the options and confirm the relevant rules with your insurer before departure.

This article provides general information, not personalised insurance advice. Your policy wording and the insurer’s written confirmation determine the applicable terms.