Reality of overseas medical expense claims

How practical and realistic is travel insurance cover (Ensuring a headache-free family holiday, May 26)?

As I understand it, for practically all insurance companies, medical costs overseas are to be paid by the insured and then claimed on a reimbursement basis. How many people would be able to pay if the medical treatment amounts to tens of thousands of dollars?

The sum assured for "medical expenses overseas" under, for example, NTUC Income, can range for different plans, for the individual, from $150,000 to $300,000, and the total for the family, from $1 million to $3 million.

The sum assured numbers look good, but what is the reality of most of us being able to pay first and then claim?

My friend's father had to have hip replacement surgery after a falling accident in Perth, Australia, and the hospital required a deposit of A$30,000 (S$28,300) before they would commence with the operation. Time was of the essence as the injury could turn septic.

My friend had a very difficult time convincing the insurance company to issue a letter of guarantee for the payment of the A$30,000 to the hospital.

This payment problem could happen to anyone, notwithstanding our having bought travel insurance for "peace of mind".

Frederick Tan Huay Teong