Health, trauma or income protection

Imagine a cancer diagnosis at 46. Three things happen at once. Treatment is required, some of which may not be publicly funded and some of which involves waiting. Income stops or drops sharply, for you and possibly for a partner who reduces their hours. And costs appear that are not in any budget — travel, childcare, a mortgage that suddenly needs to be smaller.

Health insurance answers the first. Income protection answers the second. Trauma cover answers the third. They overlap at the edges but none of them substitutes for another, and a household that holds only one will feel the absence of the other two.

Since almost nobody can fund all three at full strength, the useful question is not which product is best but which order to buy them in — and how to size each so the whole plan survives your budget for the next twenty years.

1. 1Income protection first, if you earn. It responds to every illness and injury rather than a list, and it protects the income that pays for everything else, including the other premiums.
2. 2Health insurance second, particularly the non-Pharmac drug benefit, because it is used far more often and covers the cost the public system leaves you exposed to.
3. 3Trauma cover third, sized to buy time rather than to replace an income.
4. 4Adjust the order if your circumstances demand it — no dependants and strong savings moves income protection down; a family history that worries you moves trauma up.

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

• Whether your income protection benefit period is long enough to matter for a serious illness.
• Whether your health policy includes non-Pharmac drug cover and diagnostic cover, or only surgical.
• Whether trauma cover is accelerated against life cover, and what a claim leaves behind.
• How ACC offsets affect your income protection if the cause is an accident.
• How health insurance premiums will behave in your sixties and seventies.
• Whether an employer already provides any of the three, and what happens when you leave.

Every New Zealand insurer writes health 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 build a plan to a monthly budget across all three, which is a different exercise from quoting each in isolation.
• Where an employer provides health cover, personal money is usually better spent on income protection.
• Trauma sums insured can be trimmed later without new underwriting, which makes them the sensible flex in a tight budget.
• The ACC interaction is New Zealand-specific and is where most overseas material gives the wrong answer.

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.