Is Personal Insurance too Expensive?

Personal Insurance Cost - Too Expensive?

Living in New Zealand can be expensive, and it is important to make sure that you are adequately protected against life’s unexpected events. Having personal insurance is an essential part of planning for your financial future, as it can provide you with financial protection in the event of a sudden illness or injury, or the death of a family member.

The cost of personal insurance in New Zealand will generally depend on the type of cover you require and the amount of cover you need. Typically, the more cover you purchase, the higher the cost of the policy will be. However, the cost of personal insurance is usually much lower than the financial losses you may incur in the event of an emergency. Personal insurance in New Zealand is available in a variety of forms, such as life insurance, health insurance, income protection, and trauma insurance. 

Some of our earlier blogs have gone over the different types of cover and the different types of structures you can have.  I have talked to a lot of people who want to cancel their cover, because the cost of living hasn’t gone up too much, and it’s the easiest thing to take out of the budget.  But what would happen if you lost the current income you have due to illness or injury AND you had no cover in place to protect you.  How would you pay the bills then? 

There are always triggers that we can pull to ensure your cover is more affordable, if you have a 4 week wait on your disability cover (income protection) because you think you would only be able to cope financially for 4 weeks maybe we could pull this wait period out longer to 13 weeks, or 6 months to reduce the premiums. 

Even if you would need financial assistance earlier, if your only other option is to cancel, then this may be something to consider?  A lot of the providers will also offer options to suspend premiums for a period of time under certain circumstances.  The other thing that comes up quite often is if someone was a smoker when they initially took out their policy and their premiums are based on smoker rates, however, they quit smoking over a year ago and are now able to apply to remove this status.  Quite often this can cut your premiums in half.

If you are feeling the crunch of the current cost of living, the best thing you can do is talk to your adviser.  We can come up with strategies to ensure you remain protected and try to lessen the pinch in the wallet.  Watch this space for more information and more deep dives into the world of personal insurance.

If you want to know more, get in touch with Sarah and come have a chat. You can also find her on Facebook.