Applying online versus through a broker

Both routes start in the same place: a set of questions about your health, your family history, your occupation and your habits. An online form and an adviser’s application capture broadly the same information, and your legal duty to answer honestly and completely is exactly the same in both.

The divergence begins at the first complicated answer. Suppose the question is whether you have been investigated for a heart condition and the true answer is “yes, five years ago, after chest pain that turned out to be reflux, with a normal stress test and no follow-up since”. Online, you tick yes and a free-text box appears. What happens next is an automated rule or a referral to an underwriter working only from what you typed.

Through a broker, that answer becomes a written summary with the specialist’s findings attached, put to several insurers as an anonymous pre-assessment, before any application exists. Three insurers might come back with three different positions. You then apply to the one offering the best terms, and the others never record a thing.

This is the single most useful mechanic in the advised channel and almost nobody outside the industry knows it exists.

1. 1A formal application that results in a decline, a loading or an exclusion is a disclosable event. Future applications to other insurers will ask whether you have ever been declined or offered non-standard terms, and you must say yes.
2. 2That answer follows you. It does not automatically produce a decline elsewhere, but it colours every subsequent assessment and it cannot be undone.
3. 3A pre-assessment is not an application. An adviser puts an anonymised summary of your history to several insurers and receives indicative terms back. Nothing is recorded against you, and no answer to a future question is created.
4. 4So the sequence matters enormously. Pre-assess, then apply once to the insurer most likely to accept you on the best terms. Applying blind to the cheapest insurer first is how people acquire a decline they did not need.

What each route is good at

These are the details that decide whether the cover does what you expected. Read them before you compare on price.

• That a short application does not reduce your duty of disclosure — it just gives you less room to explain.
• Whether the online product carries a general pre-existing condition exclusion instead of individual underwriting.
• Whether income protection or own-occupation TPD is available at all through the online route.
• The maximum sum insured available online, which is frequently below what a mortgage requires.
• Whether you are being offered a simplified product or a fully underwritten one — the words are not always used clearly.
• That applying to several insurers online in sequence, hoping for a better answer, is the worst possible strategy.

Every New Zealand insurer writes life and living cover to its own wording, and the words are where the money is. Two policies that look identical on price can pay very differently when it matters. Closing that gap is the entire job of an adviser.

• Pre-assessment across insurers, before any application exists, so an unfavourable answer never lands on your record.
• Help framing a complicated medical history in the way an underwriter needs to see it, with the right supporting evidence attached.
• Access to the full product range, including benefits that simply are not sold online.
• Someone who checks the sum insured against the actual liability, which an online calculator rarely does well.
• A written record of why the recommended structure suits your circumstances.

There are three ways to buy life cover in New Zealand, and they are not equivalent. You can buy direct from one insurer, which means you see one product range and one underwriting appetite. You can buy through your bank, which usually means a single insurer’s product sold under the bank’s brand, often with narrower definitions. Or you can go through an adviser, who quotes several insurers at once and is required to put your interests first.

The premium you pay is the same either way. Insurers build adviser commission into their pricing whether or not an adviser is involved, so going direct does not get you a discount — it just removes the person whose job is to argue your corner at application and at claim time.

• An adviser can see which insurer is currently taking your health history on standard terms, and which one will load or exclude it.
• An adviser can structure cover across two insurers if that produces a better outcome than putting everything with one.
• An adviser handles the underwriting back-and-forth, and is the person who chases the claim when a family is least able to.
• An adviser has to document why the recommendation suits you, which is a written record you can hold them to.

We are a referral service, not an insurer. We do not quote premiums and we do not sell policies. What we do is put you in front of one licensed New Zealand adviser who can compare the market properly.

1. 1

   You tell us what you are looking at

   The form takes about a minute. Nobody asks for your medical history on a web form — that conversation happens with the adviser, properly, and only once you have decided to proceed.

2. 2

   An adviser calls you

   A licensed New Zealand adviser talks through your situation: who depends on you, what you owe, what you already have in place, and what you are actually worried about.

3. 3

   They compare the market

   The adviser quotes across the major insurers, checks which of them will take your health history on the best terms, and puts the options side by side in writing.

4. 4

   You decide, in your own time

   There is no obligation and no cost to you. If the answer is that you already have enough cover, a good adviser will tell you that.