The popularity of private charter yacht holidays and cruise holidays has never been higher. ITIJ looks at the evolving international health insurance products available to the crewmembers who work aboard such vessels.
With both cruise and private yacht holidays, it is not just the holidaymakers who need cover – the crewmembers will also need health insurance that will cover them for evacuation off the ship, as well as repatriation. Carl Carter, deputy managing director of Voyager Insurance Services, said that whether or not an employee is on a huge cruise ship or a small private yacht, ‘it is important that they have international health insurance, as they would usually be sailing between countries, and need the portability of cover that an IPMI plan offers’.
Crew medical insurance is specially designed to protect marine captains and crew, while abiding by all maritime requirements, as Brent Judge of International Medical Group (IMG) explained: “Beyond protection and indemnity (P&I) insurance, a crew medical insurance plan will provide the appropriate cover employers need to protect their crew when injuries or illnesses occur both on and off the vessel. It also protects the employer from the Maritime Labour Convention’s provision that creates unlimited liability for the cost of medical care for the crew.”
According to the International Labour Standards Department Maritime Labour Convention (MLC), ‘in connection with the health protection and medical care that shipowners are required to provide, in principle free of charge, to seafarers working on board their ships, Regulation 4.1 of the MLC, 2006 does not identify any particular treatment – other than ‘essential dental care’ – as this would be a matter for national laws or regulations’. “Flag States are required to ensure the application to seafarers of any general national provisions on occupational health protection and medical care relevant to their duties, as well as the application of special provisions specific to work on board ship; the health protection and medical care must be as comparable as possible to that which is generally available to workers ashore, including prompt access to necessary medicines, medical equipment and facilities for diagnosis and treatment and to medical information and expertise; it must include measures of a preventive character such as health promotion and health education programmes. Seafarers have the right to visit a qualified medical doctor or dentist without delay in ports of call, where practicable. A ratifying State is also required to give access to its facilities to seafarers in need of immediate medical care who are on board ships within its territory.”
Dr Lynn Gordon, of medical assistance provider CEGA, told ITIJ: “Most vessels involved in commercial activities (including private yachts that employ staff) are bound by the MLC of 2006, which became international law in 2013. This sets out seafarers’ rights to decent conditions of work, including the right to receive appropriate healthcare free of charge.” The stipulation above that ‘medical care must be as comparable as possible to that which is available to workers onshore’, said Dr Gordon, can be problematic and lead to inconsistencies: “This inevitably leads to some variation in employer obligation, as the care available to a first-world employee in his or her own country will differ considerably from the care available to their third-world counterpart. Additionally, some countries will offer private care whilst others may give the option of state-funded facilities.”
Dr Gordon went on to say: “In addition, the Convention stipulates that costs to be covered as a minimum are ‘the expense of medical care, including medical treatment and the supply of medicines and therapeutic appliances, and also board and lodging for seafarers while away from home, until the sick or injured seafarer has recovered or until the sickness or incapacity has been declared of a permanent character’.” Employers are obliged to take out medical insurance for their seafaring employees, although the latter are unlikely to be aware of the details of such insurance policies – and cover will vary. Policies should at the very least provide access to emergency medical care, usually until employees are fit to return to their vessel or show maximum medical improvement. Benefits may also include preventive treatment for serious conditions such as high blood pressure or diabetes. “Some policies will cover non-essential care,” said Dr Gordon, “while others will put the onus on employees to seek routine or elective treatment back at home – although repatriation to access elective treatment (for example knee surgery) may be covered.”
Andrew Apps, head of global healthcare for UK-based IPMI broker Bellwood Prestbury, told ITIJ that while the implementation of the MLC has put into place a uniform level of labour standards and minimum protection for cruise and yacht company employees, it still has some way to go before being universally accepted in every country. “The responsibility for healthcare provision is squarely on the shoulders of the vessel owners, and in turn ensuring that amongst other things, access to medical care for injuries and illnesses that affect a crew member whilst on board,” he explained. “Whilst there is a duty of care to take into account, the cost of medical care, particularly in an emergency, can be extraordinarily expensive, simply because it can be difficult to access or may involve an emergency evacuation to a different location. This all costs money and is not something that any vessel owner really wants to be faced with at a time when margins are being constantly challenged and profits are being squeezed.”
Private charter employees
Carl Carter pointed out that there is a big difference between the types of international health insurance needed for cruise ships’ employees and for those who work on private yacht charters: “While both have a need for inpatient coverage and to a degree outpatient coverage, a cruise ship employee’s healthcare coverage would usually form part of an employee block arrangement of cover, so it may not be as close a fit to their specific requirements. However, they would often have the significant advantage that in most cases, they would have access to on board medical facilities.”
In the yacht crew world, cover tends to be bought either individually, or on a small group basis and arranged by the captain. The smaller group or individual nature of the policies bought by yacht crew means that the insurance tends to be more closely matched to the needs of that employee or group, as the insured(s) can offer input into the kind of cover they need and want. Another difference between the insurance provided for yacht workers and those on cruise ships is the greater need for activity and water sports cover, as typically, when the crew isn’t working, they will be more likely to enjoy adventurous activities that are readily available to them. “Often,” said Carter, “this would involve dinghy racing, jet ski use or even more perilous activities beyond wind surfing, such as kite surfing. In both cases, the employer has a legal duty of care under the Maritime Act to provide basic healthcare coverage, and in some cases the international medical insurance policy may act in conjunction with the P&I club insurance.”
A P&I club is a mutual insurance association that provides risk pooling, information and representation for its members. Unlike a marine insurance company, which reports to its shareholders, a P&I club reports only to its members. Originally, P&I club members were typically shipowners, ship operators or demise charterers, but more recently freight forwarders and warehouse operators have been able to join.
Traditionally, said Andrew Apps, when it comes to health insurance, the industry has been the preserve of the P&I clubs, but as the maritime sector changes, an increasing number of international medical insurance companies have entered into the cruise ship and yacht sector. “There is now a range of good options to choose from,” he added, “but that in itself presents a new problem. From the very basic to the most comprehensive, the scope of cover and benefits can be a minefield for the uninitiated.”
Get on board
As with most insurance policies, then, the devil is in the detail – and there is a lot of detail, according to Brent Judge of IMG, who emphasised that insurers looking to get into this market must understand the risk profile and nature of the duties that the crew and vessel perform, be capable of administering benefits on a global scale; and remain flexible and responsive to the needs of crew who are often hard-pressed to get everything done shore-side (including insurance enrollments) before they set out to sea. “It can take several years to understand and anticipate the needs of this market,” he told ITIJ. “At IMG, we have been catering to the marine industry for more than two decades, and have developed the institutional knowledge and experience necessary to serve the market. We understand the risks, challenges and needs … and can deliver global solutions that exceed the service expectations of the crew.”
What works for one globally mobile employee will not work for another, and insurance for cruise and yacht companies is far removed from that required by most expatriates. What remains the same, though, is the duty of care placed on the employer. Making sure the insurance in place will support the client to manage their claim no matter where in the world the claim is being made is paramount. As Apps said: “It’s a complex business, and not for the faint-hearted.” ■