When buying life insurance, having the necessary information gathered beforehand will make the process much easier. So before you commit to it, we suggest running through this checklist.
1. Read our complete life insurance guide: Make sure you read through our 'Good to know' guide about life insurance. You can download it from here.
2. Shopping for cover: get at least 3 quotes. Premiums can differ by hundreds of dollars. Remember that a policy that is the cheapest when you purchase it may well become the most expensive later-on, so it is worth looking at the overall cost over the expected life of the policy.
3. Ensure any pre-existing medical conditions that can be covered are covered. If you have a pre-existing health condition and or undertake a hazardous pursuit e.g. motor bike racing you may well have to pay an increased premium (a premium loading) due to the increased risk to the insurer.
4. In short, speak to an expert like a qualified Financial Adviser. Most Financial Advisers that are not employees of a financial institution, will have access to all the major providers in New Zealand.
5. Ask your insurer or your Adviser if there's anything in the policy you're unsure about and get them to explain it to you. Make sure you do this before you sign.
6. When you have insurance: keep the policy in a safe place - where your will is kept, or with your lawyer - and let your partner or family members know about it.
7. Every few years, review how much cover you need, particularly after major life changes such as marriage or divorce, having children, or children leaving home and becoming independent and maybe if you are really lucky after you win Lotto!
8. If you are changing insurers, don't cancel your old cover until you have been confirmed as a customer of the new insurer and have accepted their terms and conditions.
9. Life insurance can be a long-term purchase and in the long run you want a company that actually meets its contractual obligations (i.e. pays claims). That’s why we recommend that you only look at Insurance companies in New Zealand with a financial strength rating of A- or higher.
Key Things to Consider before getting Life Insurance
Getting the right cover level is the most significant consideration
We strongly recommend that you talk with a financial adviser to understand what level and type of life insurance will best protect you and your family.
Shop around
When it comes to buying life insurance, shop around. In some instances, we found price comparison sites quoted the same policies offered by the insurers directly for HALF the price. A 30-year-old male/female non-smoker should be able to get a $500,000 policy for under $400/year by shopping around. As to be expected, policies get more expensive the older you are.
Talk with Financial Advisers
Financial Advisers offer expertise and know the market more than anyone - if you have a specific concern, health issue or question about anything related to life insurance, they will likely be your best resource and asset for picking the best policy.
At HealthCarePlus, we have access to a nationwide team of Monument Financial Advisers*, so if you’d like to talk to one of them from your area, you can book a time for a free no obligation chat about your circumstances and what could be right for you.
Special Events
Increase Facility Enables you to increase the sum assured under your plan without the provision of medical evidence following a significant event in your life which results in increasing financial responsibilities. These significant events include: having a child, your child starting secondary school, taking out or increasing a residential home loan or receiving a salary increase and other major events covered.
Additional Trauma Cover
Sometimes called Critical Illness Cover (includes about 50 different illnesses and treatments), can be added to the life cover at an extra cost when you take out your life insurance policy.
Rate for Age & Level Premium combination
Some plans allow you at any time, to convert all or part of your Life Cover benefit from a Rate for Age premium structure to a Level premium structure without any further medical evidence.
*For over 30 years Monument Insurance has been HealthCarePlus’s appointed business partner to provide financial advice to HealthCarePlus Members on life and health insurance. (HealthCarePlus is not legally able to provide financial advice).
