When it comes to personal risk cover, there are a lot of options. Here is what you need to know about life, health, trauma and income protection options.
When it comes to personal insurance protection, there are a range of different types of cover to choose from.
For many people, an appropriate solution could be a few different policies that fit together to form a comprehensive safety net. Others might choose to focus on protection against a particular risk.
A quick overview of the main types of personal insurance available, and why you might choose them.
Life insurance
Life insurance is designed to provide a lump sum payment when someone dies. You might choose this type of cover to provide peace-of-mind that your partner would have money to help clear the mortgage, for example, if you were no longer around. Or you might want to ensure that you left money for your children.
Health insurance
There are a few different types of health insurance, depending on the sort of cover you want, ranging from policies that cover everyday healthcare needs through to those that are designed to help only with more serious health events.
Broadly, health insurance policies help with the cost of seeking healthcare. If you have cover for specialist and surgical treatment, for example, that will help you with the cost of obtaining care privately, which can often mean less of a wait than you might face in the public health system.
Trauma cover
Trauma policies pay out if you suffer one of a number of specified serious health events. The situations in which a claim would be paid are included in each policy’s terms but usually include things like serious heart attacks, terminal illnesses and many types of cancer.
People taking out trauma cover choose a lump sum that they feel might be appropriate and that is then paid if the conditions of the policy/claimable event are met.
A trauma policy payout be used any way you need it – whether that’s for treatment or to spend on your family during a tough time.
Income protection
Income protection policies step in when you are not able to work due to illness. Although New Zealand has ACC for accidents, there is no similar protection for people who are off work due to illness. If you have a partner with a job, it’s unlikely that you will be able to access the sickness benefit. Income protection can help keep money coming into your household and help you pay the bills while you're off work.
Rent and mortgage protection
Rent and mortgage protection is another form of income replacement insurance. The cover amount is tied to a percentage of your gross income or your rent and mortgage payments. A benefit of this type of cover is that it is often not offset against ACC payments. Your adviser can help you work out whether that is an important factor in your insurance mix.
Check out what's on offer
If you're thinking about how your insurance might fit together, you can use https://www.lifedirect.co.nz, which can help you look at the options available and how they might work for you. You can then choose to buy your insurance online, or we can provide extra assistance to help you.
Want to talk?
If you'd like to discuss your insurance needs, or have any questions about the different types of policies available, get in touch with us. Our team of insurance experts is ready to help, whatever your individual circumstances.
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 developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.
