Settling In
Insurance you never needed at home may be compulsory here
Cover that is optional in one country can be legally required in another, and personal liability is the policy most foreign residents have never heard of and are expected to hold.
By Tomas Bergqvist3 min read
Insurance conventions are national, not universal
Most people carry a rough mental model of what insurance is for, formed entirely by the country they grew up in. That model is not portable. Which risks are pooled, which are compulsory and which are simply left to the individual differ substantially between countries, and the differences are not obvious from outside.
The result is that a new resident can be simultaneously over-insured against risks that are covered by the state where they now live, and completely uninsured against something the law requires them to hold.
This piece describes the general categories to check rather than any country’s requirements, because those are national, they change, and getting them wrong can have legal consequences. Confirm the position from the official source for the country concerned, and from a regulated adviser if the stakes are significant.
Personal liability is the common surprise
The policy that most often catches out foreign residents is personal liability cover — insurance against causing damage or injury to another person or their property in the course of ordinary life. In several countries it is regarded as basic, held by nearly every household, and sometimes required by a landlord or by law.
People from countries where it is bundled into other products, or where it is simply uncommon, arrive without it and without any awareness that it exists. The scenarios it covers are mundane and expensive: a leak that damages the flat downstairs, a bicycle collision, a broken window in a rented property.
Where it is customary, it tends to be inexpensive precisely because almost everybody has it. That combination — cheap, common, sometimes required, and unknown to the newcomer — is why it deserves an early question rather than a late discovery.
Housing-related cover is often contractual
Tenancy agreements in many countries require the tenant to hold specific insurance, and the requirement is sometimes a legal one rather than merely a term of the contract. What it covers varies: the tenant’s liability for the property, damage to the building, the tenant’s own possessions, or some combination.
It is worth being clear about who insures what. A landlord generally insures the building; the tenant’s possessions are usually the tenant’s problem; and liability for damage caused to the property or to neighbours may sit with either side depending on the cause and the country.
Read what your contract requires before signing, and obtain any required cover before moving in rather than afterwards, since a gap can leave you technically in breach from day one.
The policies that quietly stop working when you move
The other half of the problem is cover you already hold. Home country policies frequently depend on residence, and a move abroad can end cover entirely or leave it in place but useless. Life insurance, income protection, contents cover and motor policies are all commonly affected, and the change is rarely announced.
Telling your existing insurers that you have moved is the correct step even though it may lead to a policy ending, because a policy that quietly does not cover you is worse than no policy at all. Insurers are entitled to decline a claim where the risk was materially different from what was disclosed.
The same applies to anything bundled with a bank account or a credit card at home, which people often forget they have and which is frequently limited to residents. Travel cover attached to a card is the usual example, and it tends to assume you are on a trip from your home country rather than living somewhere else entirely.
Working out what you actually need
A reasonable approach is to ask three questions of every category. Is it required, by law or by a contract? Is the risk one that would be financially serious for me? And is it already covered by something else, including a state scheme or an employer arrangement?
The third question matters most for newcomers, since countries with comprehensive state provision in one area often leave individuals to insure another, and the pattern will not match what you are used to. Employer packages can be generous in ways people never check.
Ask a local. A colleague or a neighbour can usually tell you in one sentence what everybody in that country has, and that sentence is the most efficient piece of research available. Then confirm the compulsory elements from an official source rather than from the conversation.
Common questions
How do I find out what is compulsory?
Start with the official government or regulator information for the country, and check your tenancy and employment contracts for requirements they impose. Asking an insurer is useful for products and less reliable for what the law requires, since they have an interest in the answer.
Should I keep my policies at home running?
Only where they still cover you as a non-resident, which many do not. Tell each insurer that you have moved and get the position in writing, because a policy that lapses in effect while continuing to take payments is the worst of both outcomes.
Is employer-provided cover enough?
Sometimes for health and occasionally for liability, and it usually ends when the employment does. Read what it actually covers and what happens at the end of the contract, particularly if it is the only cover you hold in the country.
Features writer, Globetrotter Talks
Tomas writes the explanatory pieces on arriving, visas & paperwork, money abroad and prefers a plain explanation to a clever one.
