Life insurance can be a confusing topic, there is so many different types of policies and covers out there and it can be hard to know what policy is right for you and your family. Let’s outline how to find the right life insurance policy for you.

What is Life Insurance and why is it important?

Life insurance is a form of contract between an insurance policy holder and an insurer which pays out a fixed lump sum if you die during the term of the contract. How much life insurance costs can depend on various factors such as how much cover you are after, your gender, age and your overall health and lifestyle. Life insurance is a competitive industry in New Zealand there are many different companies with different offerings which is making it more affordable.

How do I know what cover to get?

Making sure you get the right cover level is very important. It is important to look at your options before you decide and that is where we come in. We can help get the best cover for you that meets your current life circumstance. Whether you are looking to pay minimal costs, or you are wanting the most cover you can get, we can help find what’s right for you. As to be expected, insurance policies get more expensive the older that you get, but even then, we can source polices that don’t go up in cost as you get older!  If you have a specific concern, health issue or question about anything related to life insurance, we can be an asset to help you pick the best policy. ​

Why is life insurance Important?

Having life insurance in place makes it affordable to help your family and loved ones in order to avoid financial suffering if the worst happens. It means that you can continue to look after your loved ones even after you are gone.   

Life Insurance facts:

  • The higher the insurance cover amount the higher the cost of the life insurance policy.

  • The pay-out is paid when the policy holder dies or upon a diagnosis of a terminal illness.
  • Once you know what cover you need in place then the cheaper the annual cost for the policy is likely to be the most suited policy for you and your family. Just be aware that some products have exclusions even with life insurance.

  • The lower the risk of your death, the cheaper your life insurance can be. Life insurance premiums increase with the likelihood of death. For example, a 30-year-old non-smoker who works in an office will have a cheaper premium than say a 90-year-old smoker. Specific factors that can determine the cost of your policy are:

Age – The younger you are when you get the policy out the cheaper the policy.
Health – The healthier you are, the cheaper your premium will be.  Insurers often encourage a healthy lifestyle as it could give you discounts if you meet their criteria (we will get into this further down below).
Risky occupation –if you have a high risk job (if you work in construction or mining) your premiums will be higher.
Smoker – Smokers tend to pay a lot more for life insurance, due to the effects it has on their health and life expectancy. Vaping counts as being a smoker as well.

What you need to know about Life insurance:

  • It is important to note that non-disclosure may mean a policy will be invalid if claimed on.
  • Once you have a policy in place future changes to health should not affect your cover. Again, your policy document will outline this.
  • Your policy is the only document that outlines what’s covered.

  • You can decrease the cost of your policies if you have a healthy lifestyle. As mentioned above health plays a big role in the cost of your policy. If you do not smoke, you are already saving yourself money on insurance. There are many New Zealand insurers that encourage and reward their customers with cheaper premiums if you maintain a healthy lifestyle. For example AIA Vitality offer various discounts and rewards for those that take steps to improve their health. If you track your daily fitness routine or go for a health check you can be rewarded with Air points, New World dollars and much more. 
  • Switching your insurance policy may save you money but do note there are risks on doing this, not all policies are the same, and some have exclusions like working at heights above 15 meters! If you already have a life insurance policy, you maybe able to  switch to a cheaper policy. It is important to remember to never go ‘between policies’, don’t cancel one whilst you look for another – always get your new one in place before cancelling the original policy.
  • Remember full disclosure is needed when it comes to the discussion of any health issues, don’t try to save money by avoiding your obligation to declare recent problems. ​

Life insurance can be tricky however there are lots of options in the New Zealand market. If you are currently looking to get life insurance contact one of us today, we would be happy to help with your needs so that you are covered.