Getting your insurance reviewed

Insurance is bought at a moment — a mortgage, a baby, a new job — and then left alone. Five years later the mortgage is smaller, the children are older, the income is different, a health event may have happened, and the policy is still exactly what it was. That gap between the cover you hold and the cover you need is what a review is for.

The word “free” gets used loosely in this market, so here is the accurate version. There is no charge to you. The adviser is paid commission by the insurer if you end up placing or replacing cover, out of a premium that already includes distribution cost whether an adviser is involved or not. If the review concludes that you should do nothing, the adviser is not paid for that conversation. That is worth knowing, because it tells you where the pressure sits and why you should expect a written recommendation rather than a verbal one.

It also tells you what a good adviser looks like: one who is willing to reach the unprofitable conclusion out loud.

1. 1Collect what exists. Policy schedules for every policy, including anything held through work, a bank or KiwiSaver-linked cover.
2. 2Establish current cover. Sum insured, premium, structure, ownership, beneficiaries, riders, exclusions and loadings.
3. 3Re-run the need. Current mortgage balance, current income, current dependants, current business obligations.
4. 4Find the gaps. Usually income protection missing, trauma too small, or nothing on the non-earning partner.
5. 5Find the waste. Cover larger than the debt it was bought for, duplicated cover between a work scheme and a personal policy, riders you no longer need.
6. 6Test affordability into the future. Where is the stepped premium in ten years, and will you still be paying it?
7. 7Only then consider whether any of it should be replaced — and if so, in what order and with what protection for the existing cover.

When a review is genuinely worth doing

• You have bought a house, refinanced, or paid the mortgage down significantly.
• A child has been born, or the youngest has become independent.
• You have separated, remarried or formed a blended family — beneficiary nominations are frequently wrong after this.
• Your income has changed materially, up or down, or you have gone self-employed.
• You have changed jobs, which usually ends any employer group cover.
• Your premium has jumped and you are wondering whether to cancel. Review before you do anything.
• It has simply been five years and nobody has looked.

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

• A review that begins by quoting a replacement policy before anyone has read your existing schedules.
• Pressure to cancel existing cover before a replacement has been issued and confirmed in force.
• Recommendations that move every policy to a single insurer without explaining what is lost.
• Any suggestion that an older policy is “out of date” without a specific comparison of the wordings.
• Loadings and exclusions on an existing policy that would not carry over to a new one, and would have to be re-earned.
• The value of a policy bought when you were younger and healthier, which is often greater than its price suggests.

Every New Zealand insurer writes life insurance in new zealand 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.

• An adviser can read your existing wordings against current market wordings, which is not something a comparison site does.
• They can tell you when your old policy is better than anything currently available, and say so in writing.
• They can restructure rather than replace — reducing a sum insured, changing structure, or adjusting a waiting period.
• They carry a documented duty when recommending replacement, which is a protection you do not get buying direct.

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.