Leaving your country to work as an expatriate? According to European legislation, expatriation means losing entitlement to social security in your home country. You will have to register to your host country insurance system. Cover levels can be quite different from one country to another and sometimes happen to be inadequate. Want to stay on the safe side and make sure you are fully protected abroad? You can do so by taking out insurance before you leave.
What is expatriation?
An employee who is sent to work abroad without being seconded has an expatriate status. There is no time limit to this status. All links with the home country social security system disappear once expatriation begins. An employee may be expatriated from the beginning of his assignment abroad if the employer has not chosen the secondment option. The employee can also end up being abroad on an expatriate status once the maximum period permitted for a secondment has been reached.
Managing your benefit system
Taking out insurance is the best way to be thoroughly covered during expatriation. Many solutions are available on the market, from group policies to individual policies and each risk category can be insured separately. In some cases, your employer might select and pay for all or part of the insurance. But you might be left on your own or prefer to choose the policy that will best fit your needs abroad.
As an expatriate, you won’t have access to your home country social security cover anymore. Only French expatriates can decide to keep the benefit of French health insurance by registering to the CFE. If your home country is a member of the European Union, Island, Lichtenstein or Norway, and if you are leaving for one of these countries, transfers from one social security system to another are facilitated. Nevertheless, you could need extra cover. Here’s how an expatriate can get complete cover abroad.
- Are you a French expatriate? Go safe with CFE + top-up insurance. The CFE is the Social Security Fund for French nationals living abroad. French expatriates can register to the CFE is they wish. Employers can also deal with registration for their French employees they send abroad. Membership to the CFE does not exempt you from contributing to the statutory scheme in your host country. The CFE reimburses on the basis of French rates. In some countries, where health care costs are significantly higher than in France, additional insurance is required on top of the CFE cover to improve reimbursement levels. You can take out individual expatriate insurance or expatriate group insurance may be taken out by the employer.
- Worldwide health insurance “from the 1st euro” is suitable for all expatriates. Why the name “from the first euro”? This type of health insurance reimburses you for every euro spent. It replaces Social Security and the top-up insurance. You can take out individual expatriate insurance or expatriate group insurance may be taken out by the employer.
State pension and unemployment benefits
Expatriates usually are covered by the local scheme. Pension and unemployment benefit transfers are possible if you are moving from one E.U. member state to another. Outside the E.U., benefits obtained in the home country generally are lost once expatriation occurs. If you intend to retire abroad, you might want to take a look at the available expatriate pension plans.
Pros and cons of expatriation
As far as the employer is concerned, sending employees abroad on an expatriate status often is much cheaper than secondment. Its cost, combined with that of any mandatory local contributions, is often competitive. As an expatriate, you may freely choose levels of benefits and cover: is there a quality health insurance system in your country of expatriation? You might not need to take out a very costly expatriate insurance. Heading to the US? You’ll definitely want to make sure you are fully covered by your insurance. However, going abroad on an expatriate status often means giving up benefits in the home country and contributing to the statutory scheme in the host country. True, you can leave for a year or 15 but you won’t be able to put an end to your expatriation adventure without a great deal of preparation.
To find out more about expatriate status:
Get acquainted with the Social Security scheme of your country of expatriation.