Serious illness cover

New Zealand insurers do not use consistent names for personal risk products. The same underlying cover — a lump sum paid on diagnosis of a listed condition — is sold as trauma cover, critical illness cover, living assurance and serious illness cover depending on the insurer and the vintage of the product.

That inconsistency matters when you are comparing. A policy called serious illness cover might be a full trauma product covering fifty conditions with strong definitions, a severity-based product paying graded amounts, or a stripped-down policy covering a handful of conditions at a low premium. All three are legitimately described by the same words.

The only reliable way through it is to ignore the name and read the schedule: which conditions are listed, what the definitions require, whether partial payments exist, and whether the benefit is accelerated against life cover or standalone.

1. 1Ask for the full list of covered conditions, not the summary in the brochure.
2. 2Read the definitions for cancer, heart attack and stroke, which drive most claims.
3. 3Ask whether the policy pays partial benefits for early-stage conditions, and how much.
4. 4Establish whether the benefit is accelerated against life cover or standalone.
5. 5Check the survival period and any initial stand-down at the start of the policy.
6. 6Check the expiry age of the benefit, which is often earlier than the life cover it sits with.

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

• Whether the product is a full trauma policy, a severity-based product, or a limited-condition policy.
• How many conditions are covered and, more importantly, how the main three are defined.
• Whether early-stage diagnoses pay a partial benefit or nothing.
• Whether the policy allows a further claim after the first, and on what terms.
• Whether the benefit expires before your life cover does.
• Whether children’s cover is included, and at what level.

Every New Zealand insurer writes all types of 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.

• Product naming is inconsistent across the New Zealand market, so a like-for-like comparison requires the actual wordings.
• An adviser can map the same hypothetical diagnosis across several products and show what each would pay.
• Where budget is limited, an adviser can compare a narrower serious illness policy against a smaller sum insured on a full trauma product.
• Existing policies bought years ago under an older name may be on materially different definitions from current products.

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.