Life insurance for over 70s

The first thing to establish is whether you need to buy anything at all. Cover at this age exists to pay for something specific: a funeral, a debt, an estate cost, or an inheritance you want to equalise. If your estate can meet those costs without a forced sale, the money spent on premiums may simply be money removed from what you leave behind.

The second thing is that not all cover at this age is the same. Fully underwritten life cover — where you answer detailed health questions and possibly have tests — is still available from some insurers into the seventies. It is priced on your actual health, so if your health is reasonable it usually buys more cover per dollar than a guaranteed-acceptance product. It also takes longer and can be declined.

Funeral cover is the alternative. It asks few or no health questions, issues quickly, and covers a small sum. That accessibility is paid for in two ways: a higher cost per dollar of cover, and a stand-down period at the start during which only accidental death is covered.

This is the calculation that direct-marketed funeral cover advertising does not show you, and it is not complicated. Take the annual premium, multiply it by the number of years you might reasonably hold the policy, and compare that to the sum insured.

1. 1Find the annual premium and whether it is fixed or increases with age.
2. 2Find the sum insured, and whether it increases over time or stays flat.
3. 3Multiply the premium by fifteen and twenty years. Compare both totals to the sum insured.
4. 4Check whether premiums cease at a set age — many policies stop charging at 85 or 90, which changes the answer materially.
5. 5Check whether the policy has a cap ensuring you never pay in more than the sum insured. Some do; not all.
6. 6If the totals are close, ask whether setting the same money aside in a savings account would do the job as well.

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

• The stand-down period on any limited-questions policy — typically the first year or two pays only for accidental death.
• Whether premiums increase with age, and by how much, on a policy you may hold for twenty years.
• Whether the sum insured is fixed or indexed, since a fixed amount buys less each year.
• Whether premiums stop at a set age, which is the single biggest factor in whether the policy represents value.
• Whether a cap exists limiting total premiums to the sum insured.
• Whether an existing policy you already hold, however expensive it feels, is better than anything now available.

Every New Zealand insurer writes cover after 70 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.

• Establishing whether any insurer will still write fully underwritten cover for you, which is worth checking before defaulting to funeral cover.
• Doing the total-cost arithmetic in writing, including the effect of any premium cessation age.
• Assessing whether an existing policy should be kept — at this age it usually should.
• Being willing to conclude that no new cover is warranted, which is a legitimate outcome of the conversation.

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.