Frequently asked questions about insurance!
How will Covid-19 affect my policies?
Why should I use an advisor?
An insurance advisor is, above all else, your advocate. They are independent of whichever provider your insurance may be held with, which allows them to act in your best interests without conflict.
An experienced advisor (we recommend at least ten years of industry experience) is an expert in their field. They’ll not only save you the trouble of going from company to company, trying to work out what will suit you best, but can also can provide you with formal written advice, tailored to your particular circumstances.
In the event of a claim, an advisor will be there for you ensuring you are supported through the claim process. Make sure you use a good advisor who is recommended not only by their clients, but also by other professionals.
My bank does insurance, should I just go with them?
Your bank will usually only offer one product suite. For example Westpac has Westpac Life, BNZ has BNZ Life, ANZ has OnePath and ASB has Sovereign. This means you’re restricted to one company’s products and prices. While round pegs tend to fit in round holes, square pegs often don’t. Typically your particular circumstances (job, age, family or business situation etc) will, to a greater or lesser extent, influence where your insurance is best placed and it is always better to be able to make an informed choice.
Moreover, bank insurance is often either priced low but with matching quality, or market priced but with inferior wordings and inclusions. Of most importance though, is that at claim time, if you have bank insurance, who is advocating for you and can they be said to be doing so independently? The very entity from which you are expecting potentially hundreds of thousands of dollars is the entity you need to call for help. The conflict of interest here is obvious.
Contact us if you currently have bank cover and would like to consider alternative options.
Which provider is the best?
In New Zealand there are currently nine major life and health insurers. Depending on your individual circumstances, some providers may be better suited to your needs than others. Cost is only one consideration, other factors to be taken into account include:
- Customer service including turnaround times, claims handling, ease of use and communication
- Benefit quality - definitions of conditions and disability wordings
- Claims payment performance
- Financial strength rating
If you’re insured with a major provider, with a quality advisor in your corner, the question of which provider is best is answered best by whether your current insurance plan suits your needs.
Contact us to arrange an assessment of your current insurances.
I’ve used a broker before and never heard from them again. How are you different?
At IronOak we take service seriously and our mission is to provide an insurance experience second to none. We are readily contactable, will catch up with you for an annual review and send quarterly newsletters. We are big enough to look after you the way you deserve, and small enough so your voice isn’t lost in the crowd.
In our experience, a broker may not stay in touch because they’ve left the industry or moved to a new company, leaving their clients behind. They may have oversold their clients, burdening them with unnecessary cost and fear reductions or cancellations, or may have too many clients and inadequate resources to look after them properly.
IronOak offer comprehensive, expert advice yet allow for the reality of budget constraints. We have excellent support staff, significant industry experience and will be around for decades to come.
How much should I be spending on insurance?
As a general rule of thumb, you should allocate 3-6% of gross income towards your personal insurance budget; more if you need to include business insurances as well. This should be considered separate to your house, car and contents insurance costs.
Based on our many years of experience, some people are okay with no insurance at all (which is fine, until it’s not!), some want all the insurance they possibly can, and most of us tend to fall somewhere in between. How much you end up spending will ultimately depend on a number of factors including income, children, home ownership, debt levels, self-employment, marital status and budget flexibility.
Contact us if you would like to discuss your premiums.
The other reason premiums go up is because of inflation. Most insurance benefits are linked to the consumer price index. This means the benefit amount increases according to inflation each year, with a corresponding increase in your premium. With some insurance benefits it’s possible to level your premiums so they don’t increase according to age and/or inflation. This generally results in a higher premium initially, but significant savings can be achieved in the long term, and coverage can be sustained for a much longer period of time. Contact us if you would like to discuss levelling your premiums.
While a lot of minor health claims are fairly straight-forward, when it comes to significant disability, trauma, disablement or death claims it’s imperative you have someone advocating for you and helping you with the inevitable paperwork and other insurance provider requirements.
Let your advisor know as soon as it looks like you may need to claim. They are experienced and can help ensure your circumstances and information are presented so your claim is accepted sooner rather than later, and with as little fuss as possible. Contact us if you need to discuss a potential claim.
As ACC levies are compulsory for all NZ earners and employers, it’s not possible to have income protection solely instead of ACC. It’s important to make sure you are covered for both illnesses and accidents. For self-employed business owners and shareholder-employees there is an option whereby ACC levies may be managed and reduced. Find out more about ACC for the self-employed.
Policy ownership can be updated and changed at any time during the life of a policy, but ideally it should be set up correctly from inception. Policies can be owned by individuals, either solely or in joint names, by companies, or in the names of individuals on behalf of a trust.
It is important to ensure that the entity that owns the policy is the entity that needs the funds. Many old policies still have the bank of record as the policy owner. Policies jointly owned by a couple who have since split up will require a change of ownership. Similarly, if a house and its corresponding mortgage debt are sitting in a family trust, the life insurance policy needs to be owned by the trustees, on behalf of the trust. Contact us if you have concerns about your policy ownership.
IronOak Financial Services are West Auckland based, with clients New Zealand wide.
Our small but dedicated team of advisors and support staff bring experience, passion and impartiality to insurance advice. We draw from our expertise in the areas of personal and business insurances to advise and support our clients to make well-informed decisions.
Call Daniel Smithwood - 0225305034
Do you have an insurance question?
As a small business owner there are always expenses to cut down on so I was thinking about canceling my income protection. Daniel told me not to and I'm so glad I took his advice. I hurt my knee on the job not long after that and ended up being off work for almost 6 months. Daniel helped me with both my income protection claim and my ACC claim. Thanks to him, I was able to claim from them both. Having Daniel there to advise, liaise and advocate for me made a huge difference at a very stressful time. It is entirely likely I would have lost both my business and my house otherwise. Jeremy Cox, JDC Builders