NZ life expectancy: what does it have to do with Insurance?

As time goes on, the average life expectancy of New Zealand’s population is increasing (according to the World Bank), with many of us living longer than before. The added time we have on Earth can impact our lives in plenty of ways – including our retirement savings, financial planning and Life Insurance.

To make sure you’ve got life covered, let’s take a look at how New Zealand’s life expectancy can affect your Insurance.

What are the stats?

The most recently-available data from the World Bank shows that New Zealand’s life expectancy from birth in 2015 was 79.73 years for males and 83.27 years for females. In addition, mortality rates are decreasing overall.

As a country, we’re also sitting slightly ahead of other developed nations like Australia (82.45), the UK (81.62) and the United States (78.74) – but just behind Japan at 83.84 years.

Healthy hints

Living to a ripe old age takes a mix of willpower, a healthy diet and good habits. We know that it’s important to exercise regularly and eat the right foods – but being healthy doesn’t just increase your chances of long life; letting go of harmful behaviours like smoking could lead to lower premiums on your next Insurance policy. And, if you’re going to be around a little longer, those savings could really come in handy.

What does this all mean for Life Insurance?

The longer we live, the more long-term affordability becomes important. That’s why it’s a good idea to aim for cover that isn’t just suitable for the needs you have today, but also sustainable in the long run.

One of the options to consider is Level-Premium Insurance. Unlike Stepped Premium Insurance, where premiums increase as you age, Level Premiums stay the same through the contract – they usually start higher than Stepped Premiums, but they can give you more certainty on cost and save you money over time.
If you’re looking to get your Life Insurance sorted, please don’t hesitate to get in touch. Every Insurance provider is different; as Insurance advisers, we can help you secure the right level of coverage, whether you live to 80 or 108.

 

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current development or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek advice from a financial adviser.

What does Life Insurance REALLY buy you?

Life Insurance – while not everybody has it, those who do generally have cover to ‘pay off the mortgage’ or ‘leave something to the kids’ should they prematurely die.

However, Life Insurance provides more than just a debt repayment, or bequest facility. Life Insurance ensures your family is able to maintain their lifestyle in the event you are no longer there earning an income and contributing to the family’s costs.

And if you add up how much income the family would potentially lose, it is often a lot more than the level of cover most people have.
So, what can life insurance buy your family?

Peace of mind

In the event of your premature death, your family immediately loses your income – which they are likely to be relying on to pay bills and meet lifestyle costs. Having cover in place means your family has the peace of mind that, in the event of something happening to you, they will still be financially OK.

Freedom of choice

Having a lump sum available means that your family or surviving partner has the ability to make choices that suit them, rather than having to decide because of financial considerations.

For example, if your family can’t meet the mortgage payments, they may have to sell and move to a different area, away from schools and friends. Having cover in place to either repay the mortgage in full or meet the payments for a specified period of time, means that they have the freedom of choice to stay put or move.

Time for grief

Grief is different for everyone. While one person may want to keep working through that period, another may feel the need to take time out.

Having some funds available to replace income for a specified period of time (two years, for example), means that the surviving spouse can grieve in their own way, and not feel pressured to have to return to work – or find work if they were not working.

A lifestyle for your family

Lifestyle isn’t just about paying the mortgage and bills. What do you and your partner or family enjoy doing? What hobbies or sporting activities do your children have that you’d like them to be able to keep doing, even if your income has stopped?

By provisioning some additional funds for lifestyle needs, your family can maintain their lifestyle, with less stress and change in the event of your premature death. And remember: even if you’re not the main income earner (or maybe not earning any income at all), your contribution to the house has a quantifiable financial benefit, which needs to be considered.

An Adviser Disclosure Statement is available free and upon request. 

Stepped or Level Premiums? What works for you?

Life insurance – it’s an important choice. It’s the kind of financial decision that requires a fair bit of thinking about what you need today, and what you might need in the future. One of the key components in the life insurance decision is short and long-term affordability. Which brings us to our topic: Stepped and Level premiums – what’s right for you?

Stepped vs Level – what’s the difference?

The main difference is pretty straight-forward. Stepped premiums (“rate-for-age”) are age-related and increase as you get older, but are usually cheaper than Level premium insurance in the short-term.

With Level premium insurance, on the other hand, you don’t have to worry about increasing premiums as they remain steady throughout the duration of the contract. Level premiums are usually higher than Stepped premiums at the start of the policy, but lower in comparison in the longer term.

So, in a nutshell, with Stepped premium insurance you tend to save in the short term. With Level premium insurance, you tend to save in the long term.

You can also choose a ‘mix’ of stepped and level

There’s nothing like a real-life example to show the benefit of choosing the right premium type.

Around eight years ago, I helped one of my clients (a couple) set up a Life Insurance policy. After a thorough conversation, we decided to mix stepped and level premiums. The clients put a certain amount on Level, namely the amount that they felt they would like upon death. The remainder was stepped (therefore, set to increase with age).

This was a smart move. As stepped premiums increased and debt reduced, my clients could in fact gradually reduce their stepped cover (without touching the levelled amount, obviously). And in the meantime, they could also benefit from the short-term savings made thanks to cheaper stepped premiums.

As a result, as prices have gone up on the Insurances over the years, the stepped cover is nearly the same prices as level and so the savings are already seen.

What works best for you?

How can you choose what’s right for you? The choice between Stepped and Level premium insurance mainly depends on whether you think the level of cover you need may change, and in what period of time.

If you think you need a higher level of cover in the short to medium term, and a lesser level of cover down the track, then Stepped premium insurance could be an option for you. If, on the other hand, you think the level of cover you need won’t reduce, then locking in your premiums now and saving down the track with Level premium insurance could be more appropriate for your needs.

No crystal ball but good advice available

Please don’t hesitate to contact us: it’s our job to help you find the right fit for both the short and the long turn.

Of course, none of us know exactly what we’ll need in five or ten years. But sitting down with an adviser and talking through where you are at now, where you think you’ll be in the future and how the options stack up to your needs, is a good idea. Having some comparisons to consider is often the best first step in making an appropriate choice for your personal circumstances.

And with that in mind, we’re here to help and welcome you to get in touch if you’d like to compare Stepped and Level premiums and how they apply to your life insurance needs.

An Adviser Disclosure Statement is available free and upon request.

Young and healthy? Three reasons why Insurance is a good idea

Thinking about the unexpected isn’t always easy and – especially when you’re young, healthy and dependant-free – the ‘worst case scenario’ may not be on your radar yet. But there are plenty of reasons to consider Insurance at a young age.

If you belong to the Millennial generation or know someone who does, this quick read may help you put a couple of things into perspective.

No one is bulletproof

Sadly, recent research found that certain medical issues are no longer limited to the elderly, and these include strokes, diabetes and bowel cancer (+15 percent among under-55 Kiwis in the last 20 years, according to a University of Otago study).

Being young is usually about experiencing life as it flows, living for the here and now. Of course, this sense of endless opportunity and invincibility is certainly empowering. But keep in mind that, should the unexpected happen, personal Insurance could help you remove the financial stress that you and your loved ones may face.

Protecting your future will never be this cheap again

You are your most important asset, and protecting yourself from the ‘worst case scenario’ may only cost you a few dollars a week. In fact, one of the advantages of taking out Insurance when young and healthy is that premiums are at their lowest. Plus, if you choose level-premium Insurance, you might even be able to lock in that premium rate for life.

Do you have any financial commitments?

You may have debt, such as a student loan or a mortgage. And if you suddenly stopped earning an income or worse, these commitments could easily turn into an additional burden for your family or partner. Insurance is designed to prevent that – on the off-chance that something happened to you, money would be one less thing to worry about.

Depending on your personal circumstances, there are different types of cover available. From Income Protection to Life Insurance, from Mortgage Protection, to Health Insurance and Trauma Cover, each offers different benefits, on different terms and conditions. If you’re keen to find which works best for you, please don’t hesitate to get in touch.

An Adviser Disclosure Statement is available free and on request.

Insurance company refuses to cover Auckland mum with rare illness

 

Here is a great article which points out why getting good financial advice is important, so that you have the right cover for what you require it for. We listen to find out what you want the cover for, before coming back to you with recommendations.

Trauma insurance is a great cover to have, (We have had some amazing claims stories) but it is specific to a list of conditions (these vary dramatically depending on whether it is a bank product or one through Insure NZ). We will also look at other options that would have covered Selina in the situation below. We can mix and match cover, so that it will cover as much as we can for your particular budget.

Three months ago Selina Linton fell out of bed, unable to move her legs. She barely remembers the following weeks spent intensive care; doctors can’t say exactly when, or to what extent, she will recover.

The Auckland woman was struck by Guillain-Barre Syndrome — a mysterious, debilitating illness that attacks the nervous system. The 54-year-old dental assistant remains in a rehab centre, in nappies, unable to walk.

Her husband Nathan Linton, 53, said he was shattered to learn the trauma insurance policy they had been putting money into for over two decades didn’t cover Guillain-Barre. It wouldn’t pay out for what the family deemed an “incredibly traumatic” experience.

The Lintons’ discovery is not unusual. Trauma insurance, also known as crisis or critical illness insurance, is a broad term for a highly specific type of coverage. It pays a lump sum to be used any way the insured chooses.

Selina’s medical bills were covered by the state, so Nathan said the money would have gone into modifying their Titirangi home for the wheelchair his wife was likely to return with. He said the family were also “getting kicked” through being one income down.

Nathan said he hoped others might temper their expectations of trauma coverage after his family’s experience: “we’d have done better putting the money in a jar by the bed”, he said. Ideally, he wanted Guillain-Barre put on insurance companies’ trauma tick list.

A spokesman for AMP, the Lintons’ insurance provider for over two decades, said trauma policies didn’t cover Guillain–Barré Syndrome for several reasons, including because only 40 to 80 New Zealanders got it each year.

“Insurers can’t cover every eventuality – if they did premiums would go up and cover would not be accessible or affordable,” he said.

Guillain-Barre sufferers who permanently lose their ability to “perform key tasks independently” could, however, get a pay out through trauma insurance, he said. Selina was not eligible as doctors believed she would eventually recover.

Karen Stevens of the Insurance and Financial Services Ombudsman (IFSO) said she had many clients who, like the Lintons, felt misled by their trauma policy.

“Trauma in everyday language means something unexpected that happens to you and plays havoc with your life — but if it’s not specifically mentioned in your policy, it won’t be covered,” she said.

“We recently had a woman come in who had suffered fairly horrific injuries from giving birth to a baby, for example, which left her incapacitated. She said it was the most traumatic thing that could have happened to her, but since birth wasn’t mentioned in her policy there was nothing we could do.”

Stevens said disgruntled heart attack victims approached the IFSO “constantly”. While trauma policies typically include heart attacks, they only pay out if certain events play out.

Since being in hospital Selina has had pneumonia, a tracheotomy — doctors cut a hole in her windpipe to get air to her lungs — a flooded lung, and excruciating nerve pain. Her husband said her “good brain inside a very sick body” — which until recently could not speak — and the ever-fuzzy prognosis of Guillain-Barre had taken psychological tolls too.

She could barely keep her eyelids up at 4 o’clock in the afternoon last Tuesday, in a wheelchair at her Point Chevalier rehabilitation clinic. She held her husband and their 22-year-old daughter Lucy’s hands, and cried.

“Now I should be finishing work for the day and going home to cook dinner with my family,” she said. She missed the Titirangi trees, her dog, and “catching up with the girls”.

Nathan promised to get their wheelchair-unfriendly house ready for her “somehow”, to hasten her homecoming.

“We’ll suck it up,” he said. “But we thought we were responsible, taking out that insurance policy so that if something like this happened, we’d be able to look after each other comfortably.”

WHAT IS GUILLAIN-BARRE? 

– It is a collection of symptoms, rather than a single disease.

– They include rapidly progressive weakness, sometimes resulting in complete paralysis.

– Recovery typically takes three to six months, though two-thirds never fully recover and it can be fatal.

– It frequently follows another health problem such as food poisoning, flu, childbirth or surgery.

– Two cases were triggered by the campylobacter outbreak from contaminated drinking water in Hawke’s Bay last year.

If you have any concerns about your insurance cover and wish to have a free no obligation chat, please call on 09 551 3500 or click here

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Call for NZ to rethink bowel screening

New Zealand needs to rethink its exorbitantly expensive second-rate bowel screening programme based on research from the UK.

That’s the view of Associate Professor Brian Cox from the University of Otago who says UK research proves flexible sigmoidoscopy screening is better than the faecal occult blood (FOBT) New Zealand is planning to use.

During a sigmoidoscopy exam, a thin, flexible tube, or sigmoidoscope, is inserted into the rectum, while a FOBT detects very small amounts of blood in a bowel motion before they become visible to the naked eye.

The results of a UK trial of flexible sigmoidoscopy published in The Lancet confirmed the reduced bowel cancer incidence and mortality persists for at least 17 years after the flexible sigmoidoscopy test. The benefit is very likely to persist for the rest of a person’s life, Professor Cox says.

He says a 15-minute sigmoidoscopy is by far the most cost-effective strategy for reducing bowel cancer in New Zealand and it could be performed by GPs.

“This is the most cancer-preventing 15 minutes anyone could ever undertake.”

A flexible sigmoidoscopy screening test once when aged 55-64 years reduces lifelong risk of bowel cancer by 35 per cent and mortality from bowel cancer by 41 per cent.

Professor Cox says the earlier results of the UK trial at 11 years of follow-up were published in 2010 but were not deemed sufficient by the Ministry of Health to guide the development of bowel screening policy in New Zealand and only a pilot study of two-yearly FOBT screening was pursued.

The evidence from the UK trial clearly indicates the need to completely rethink the approach to bowel screening in New Zealand before an exorbitantly expensive second-rate FOBT programme is instituted, he says.

A national flexible sigmoidoscopy programme could begin within 12 months covering the entire country.

About 3,000 New Zealanders are diagnosed with bowel cancer each year, and it’s the second most common cause of cancer death.

Budget 2016 invests $39.3 million for national bowel screening, starting with Hutt Valley and Wairarapa DHBs in 2017.

Source

MISTAKES TO AVOID WHEN BUYING INSURANCE

Buying insurance can be confusing, but when the unexpected happens – a death, floods, car accident, unable to work or illness – it’s a relief to know that some of those financial losses will be covered. But how do you know how much coverage you need? And what questions should you ask before buying a policy?

Many consumers aren’t sure. Insurance coverage is far from one size fits all, so here’s a look at mistakes some consumers make when buying insurance.

Assuming insurance is unaffordable.

A large percentage of the population has no health or life insurance. Often that’s because people feel they can’t afford it. This is not correct and you will be surprised at what you are able to get.

The average consumer thinks life insurance is three times more expensive than it actually is. And often they do not research the actual costs.

When buying insurance, ask about potential discounts. These may be offered if you place all your insurance with one company or you may be able to get discount on medical insurance if you add some other cover with it.

Relying on assumptions or outdated figures.

It is surprising how many people we talk with who realise that they may either be underinsured or in some cases over insured because they have not had their insurances reviewed for a while.

As things change so quickly in the insurance industry, it is worthwhile reviewing your insurance on a regular basis because you need to make sure that it meets your needs at the time you need at the most.

Click here to see video on why to review you insurances

Shopping on price alone.

Comparing insurance policies can be confusing, but resist the urge to simply choose the policy with the lowest premium. Consider the company’s reputation and the coverage you get for the premium you pay.

What we do for our clients is make sure the company that we decide to choose, has good claims paying history, at application stage they have the company that will offer the best terms and policy wordings that at the time of claim have more chance of paying.

Glossing over the details.

Insurance companies pay a claim when you meet the policy wordings of the insurance cover. It is always wise to read and understand these wordings, so you are aware of may or may not be covered. We specialise in this, so you do not need to and available to answer questions if anything is unclear.

What I see when I meet with clients is that they have insurance cover, but due to the complex wordings of the policy document and not having a degree in law to understand these, that people find it hard to understand exactly what they covered for. I actually have a law degree from the UK and therefore am able to decipher these wordings for you and help you understand them in plain English.

Setting your excess too low.

Setting a low excess typically means higher premiums. Insurance is designed to protect against losses you could not cover yourself, so if you can afford to pay the first $500 or $1,000 yourself, you may not need a lower excess. Consider your own financial situation. How much of the risk are you willing to insure yourself?

Because insurance can be so complicated, we recommend a regular review of all your policies to ensure you are adequately covered. Now would be a good time to call and book a time for a review so you don’t find yourself out of pocket should disaster strike.

Feel free to contact us for a free no obligation chat – Insure NZ – 09 551 3500 or click here

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Diabetes – How much do you know?

Diabetes is a disease where your body cannot control its blood sugar levels properly – either because your body doesn’t make enough (or any) insulin, or because your cells have become resistant to insulin.

Insulin is a chemical produced in the pancreas. It helps your body process sugars.

  • If blood sugar levels aren’t kept under control, diabetes can be life-threatening.
  • Diabetes can lead to other health conditions, including kidney failure, eye disease, foot ulceration and a higher risk of heart disease.
  • Keeping your blood sugar at a safe level means you’re less likely to have other health problems.

There’s no cure for diabetes, but there are things you can do to stay well. Support from your friends, whānau and health care providers can help

Heart and diabetes checks

Diabetes is our largest and fastest growing health issue we face in New Zealand. Diabetes is closely linked with heart disease (also known as cardiovascular disease or CVD), and together they are responsible for the deaths of more New Zealanders each year than cigarettes are. Many of these deaths are preventable.

The More Heart and Diabetes Checks Health Target has been established to help save these lives – aiming to have regular heart and diabetes checks for at least 90 percent of those at risk of developing these conditions. Find out more about heart and diabetes checks.

How common is diabetes?

There are over 240,000 people in New Zealand who have been diagnosed with diabetes (mostly type 2). It is thought there are another 100,000 people who have it but don’t know.

  • Diabetes is most common amongMāori and Pacific Islanders. They’re three times as likely to get it as other New Zealanders.
  • South Asian people are also more likely to develop diabetes.
  • The number of people with both types of diabetes is rising – especially obesity-related type 2 diabetes.

Type 1 diabetes

Type 1 diabetes is when your body has stopped producing insulin. People with type 1 diabetes need to inject insulin to live.

  • Type 1 diabetes is usually diagnosed in children.
  • Type 1 diabetes is less common than type 2 diabetes.

Type 2 diabetes

Type 2 diabetes is when your cells have become insulin resistant or your body doesn’t produce enough insulin to keep you healthy.

  • Type 2 diabetes usually develops in adults but it is becoming more common in children.
  • Type 2 diabetes is the only type of diabetes linked with obesity.

Diabetes in pregnancy

Pregnant women can also develop diabetes. This is known as gestational diabetes (or ‘diabetes in pregnancy’). It usually goes away when the baby is born.

But the problem is more widespread than that, and it appears to be worsening.

In fact, advocacy group the International Diabetes Federation has estimated that by 2040 the number of adults with diabetes globally will rise about 55 per cent to reach 642 million.

And there’s no room for complacency, with the federation stating that the condition kills one person worldwide every six seconds.

However, diabetes can often be effectively managed, even prevented.

While access to quality medical care plays a large role, so too does public awareness of diabetes, and to test your knowledge, we’ve developed a quiz.

Answer the 10 questions below as true or false, then check the answers to see how you fared.

Afterwards, you may also like to complete or update your Wellness Assessment to learn about your diabetes risk and potential ways of addressing it.

For more information and individual advice, consult an appropriate health professional.

 

What’s your diabetes knowledge?

Indicate whether the following statements are true or false.

  1. Glucose is found in blood only.
  2. Insulin is a hormone normally released into the blood after eating.
  3. Type 1 diabetes is a lifestyle disease.
  4. In type 2 diabetes, the body may stop responding to insulin properly.
  5. Being overweight does not increase the risk of type 2 diabetes.
  6. You can develop type 2 diabetes without experiencing obvious symptoms.
  7. Type 2 diabetes increases the risk of cardiovascular disease.
  8. People with diabetes should avoid sugary food and drink.
  9. Type 2 diabetes always requires medication.
  10. Gestational diabetes goes away after pregnancy.

Click Here For Answers

Source 1, Source 2

Do your insurance premiums increase each year? – Would you like to know how to stop this?

Are you like most people – you receive an insurance renewal each year and you have a look and then file it away. You get older and then suddenly notice that the premiums are getting too expensive!!!

Unfortunately, as you get to an age where you could possibly need the insurances, the premiums become unaffordable!! There are ways to control this and in the long run you will pay a lot less premium.

Some companies even offer level term premiums not just for life insurance, but also trauma and income protection. You can also choose the period of time you wish to have level premiums (5 years to age 100) – this can be adapted to your budget and time frame you require the insurances.

Here is an example, of a Female aged 40 non-smoker – with $500,000 life cover.

Projection 1 = premiums increasing with age
Projection 2 = level premiums to age 70
Projection 3 = level premiums to aged 80

level-cover-comparison

As you can see from above, you pay just over $58 more to start, but when we compare the chart above between increasing with age (projection 1) and the level premium cover to age 80 (projection 3):

  • At age 52 – you are paying $96.25 per month with age increase premiums compared to $92.31
  • at age 61 – total cumulatively are breaking even – so anything after this age is a savings
  • At age 80, you would have saved over $235,000 in total premiums.

Could you afford $430 per month at age 66 for the cover?

So if you are looking at insurances that are affordable when you need it most, then this is an option that you should be looking at. We have helped clients to have a mixture of level premiums and premiums increasing with age to meet their particular needs.

Please give us a call on 09 551 3500 or email admin@insurenz.co.nz.

Why review your insurance policies – How we can help!

It is good idea to review with your insurances, if you have not seen your adviser for a while or do not have one give us a call 09 551 3500 or 0280 467873.

As our business name suggests, our team services New Zealand wide.

We can also arrange and review certain insurances for Kiwis living abroad.