Insurance for accountants and lawyers

Professional services work is as light as occupations get, and the insurance market treats it accordingly. Accountants, lawyers, actuaries and similar professionals sit at the top of the table with the cheapest income protection, benefit periods to age 65, own-occupation definitions and the shortest waiting periods on offer. The occupation is not the problem.

The problems are structural. First, income. A salaried solicitor has a simple application. A partner in a firm has drawings, a profit share that varies with the year, capital tied up in the partnership, and possibly a company or trust in between. Insurers can assess all of that, but only if it is documented properly, and the difference between a well-presented application and a lazy one is measured in the maximum benefit offered.

Second, the practice. If you are off for six months, your income stops and the firm’s costs do not. Rent, staff, practice management software, professional indemnity premiums and practising certificates all continue. That is what business expenses cover addresses, and it is separate from personal income protection.

Third, the partnership itself. Most firms have an agreement covering what happens if a partner dies or becomes permanently disabled. Far fewer have funded it. An unfunded buy-sell agreement is a document that describes an obligation nobody can meet, and it leaves a grieving family holding an illiquid share in a business that cannot buy it back.

Treating these as one problem is why professional firms are so often underinsured in the ways that matter.

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

• How partnership income is defined and evidenced, including drawings, profit share and any entity in between.
• Whether income protection uses an own-occupation definition, particularly for specialist practice.
• Whether a partial or loss-of-earnings benefit is included, for a return at reduced capacity.
• Business expenses cover sized to the firm’s real fixed costs.
• Whether any buy-sell or shareholder agreement is funded by insurance, and whether the sums insured are current.
• The mental health benefit limit, given the claim pattern in professional services.

Every New Zealand insurer writes cover for professional firms 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.

• Partnership and trust income needs a properly prepared financial file. How it is presented directly affects the benefit an insurer will offer.
• Buy-sell funding requires the policy structure and the agreement to match. Advisers see this misaligned constantly.
• Own-occupation definitions differ in how narrowly they describe professional work, and the differences matter for specialists.
• Where a firm already provides group cover, personal cover should sit on top of it rather than duplicating it.

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.