By Dave Pelland, Managing Editor, KPMG's Insiders

As U.S. corporations continue to send employees to the far corners of the world, more companies are turning to insurance-related products to help travelers deal with the wide range of accidents that can occur abroad. Whether the problem is as straightforward as helping an employee secure medication or as complex as an international medical evacuation, insurers say they’re seeing strong demand for travel-related products and services.

“Employers are very nervous about their employees’ safety, and that’s why the activity has picked up,” says Steve Mueller, vice president of sales and field operations for Zurich North America, who says interest in travel insurance products has increased since Sept. 11. “There’s more awareness of what employees can be exposed to. Human resource managers, who are typically the ones who get these kinds of emergency calls, are concerned about how they can help employees if something unfortunate does happen.”

Sharon Vartanian, assistant vice president of group life products for Sun Life Financial, says the increased awareness of travel-related risks has boosted interest in making sure employees can get help when traveling. The increased demand has come despite a downturn in travel that followed the terrorist attacks.

“People are still traveling for business, even though many are using alternative ways to get where they’re going,” Vartanian says. “Some people who aren’t getting on planes are going by car. But what we’re hearing a lot is, ‘God forbid, what if I need to go to a hospital someplace?’”

Even with the current slowdown in both the airline industry and the economy overall, companies providing assistance to travelers say the market opportunities are strong. According to the Department of Transportation, U.S. and international air carriers flew 142 million passengers between the United States and the rest of the world in 2000, the most recent year for which statistics are available. That 142 million is up 7 percent over 1999; the number of U.S. travelers flying abroad grew by 6 percent in 1999.

While the specific offerings may differ, most travel-assistance companies provide a bundle of services addressing typical problems. If someone is sick or injured more than 100 miles from home, the assistance company will usually arrange for the patient’s transportation to the medical facility best equipped to meet his or her medical needs. This includes an ambulance ride to a trauma center in a U.S. city and an airplane evacuation from a developing nation. The companies can also send a translator to help a patient communicate with foreign medical staff and officials or bring family members to the patient’s bedside during extended hospitalizations.

Other services include helping travelers recover lost baggage or arrange legal assistance. If a traveler dies overseas, the assistance companies will arrange for the repatriation of the person’s body or remains--a process that can involve negotiating a thicket of regulatory and cultural requirements.

George Howard, president and CEO of travel assistance service company Assist America Inc., says U.S. travelers run into serious problems more often than expected. Assist America typically handles 15 to 20 medical evacuations a month. Only about 35 percent of those take place within the United States.

“Americans travel a lot, and they can face a lot of challenges overseas,” Howard says. “In the States, you can present yourself to an emergency room, and by law, they have to start treating you. Overseas, that’s not always true.”

While international medical evacuations attract the most attention, the assistance companies usually resolve more mundane issues such as helping travelers fill prescriptions in distant cities. Mueller says that utilization patterns are fairly predictable, with most calls coming from travelers looking for information (weather forecasts are especially popular) before they leave.

Both Zurich and Sun Life market the travel products, which cover people whether they’re traveling for business or pleasure, as additions to existing group accidental death and dismemberment (AD&D) or life coverages. Mueller compares the additional premium to an employer investing in loss control services designed to help reduce losses under a property policy. “If an employee gets back to work sooner, that helps everybody,” he says. “An international evacuation can easily cost more than $100,000, and the lost productivity can escalate the cost dramatically. If something like this helps save a life, that helps the employer financially as well.”

Mueller says the illness-related calls are divided fairly evenly between business and pleasure travelers. Vacationers, with more free time and a stronger propensity to engage in unfamiliar activities such as scuba diving or riding mopeds in the Caribbean, tend to account for a larger percentage of injury-related calls.

Howard says his company has done a medical evacuation from Mount Everest and has brought people home, dead and alive, from every continent except Antarctica.

“There are a number of places where we’d rather not get involved, but Americans go all over the place, and we don’t have a choice but to follow them.”