Enduring power of attorney and your insurance

An enduring power of attorney is a document you sign while you have capacity, appointing someone to act for you if you later lose it. New Zealand has two types: an EPOA for property, covering your money and assets, and an EPOA for personal care and welfare, covering decisions about your health and living arrangements. Both are set up under the Protection of Personal and Property Rights Act, and both require independent legal advice for the person giving them.

The property EPOA is the one that governs insurance. If you have a stroke, develop dementia, or are seriously injured and cannot manage your affairs, your attorney is the person who can keep the premiums paid, deal with the insurer, update details, and lodge a claim on your behalf. Without one, an insurer has nobody it can lawfully deal with — and the family has to apply to the Family Court to have a property manager appointed, which takes time and costs money at the worst moment.

This is the quiet gap in most people’s planning. Households buy trauma and TPD cover precisely for events that can affect capacity, and then leave nobody with authority to claim on it.

Setting it up before you need it

1. 1See a solicitor and put both EPOAs in place — property, and personal care and welfare.
2. 2Choose attorneys who will actually be available and who you would trust with your bank account.
3. 3Decide whether the property EPOA takes effect immediately or only on incapacity, and understand the difference.
4. 4Tell your attorney what insurance you hold, which insurers, and who your adviser is.
5. 5Keep a copy of the EPOA with your policy documents, so it can be produced quickly.
6. 6Review it when relationships or circumstances change, the same as a will.

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

• Whether you have a property EPOA at all, and whether it is current.
• Whether your attorney knows what insurance exists and where the documents are.
• Whether the EPOA takes effect immediately or only on a medical certificate of incapacity.
• Whether the insurer has been given a copy, or will need one at claim time.
• Whether more than one attorney has been appointed and whether they must act jointly.
• That an EPOA cannot be created once capacity is lost — it has to exist beforehand.

Every New Zealand insurer writes life 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.

• An adviser will ask whether an EPOA exists as part of a proper review, which is more than most people are ever asked.
• They keep a record of the attorney’s details with the policy file, so the insurer can be given what it needs quickly.
• They can deal with an attorney directly once the EPOA is in effect, which takes pressure off the family.
• They will refer you to a solicitor to put the documents in place — this is not something an insurance adviser can draft.

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.