Want to buy life insurance, or know who is the best provider in New Zealand? There are many different providers in New Zealand. Some examples of places to buy insurance include the banks such as ANZ, as well as various other providers such as Sovereign, AIA, Fidelity, Asteron, Partners Life, Cigna and a few others.
So with so many different insurers to choose from, which one is the best? Rather than answering this question with one name, this article will instead look to identify a few areas to think about when choosing the best insurance provider.
Underwriting process and leniency
Some insurers are more lenient than others with regards to assessing clients situations, especially around their medical history and family history. Some insurers may impose a significant loading or surcharge to the policy if they believe a potential customer brings a high level of risk. Other insurers may not be as strict about the matter, and may only have a smaller surcharge or maybe even no surcharge at all.
Consider however that there are some insurers that do not underwrite policies well. They may ask you just a few questions when signing up. However when it comes to claims payout, they may exclude you on a lot of matters. If anything; embrace the questions asked in the assessment process and answer them thoroughly.
Many people tend to shop around based on price or cost. While some insurers are slightly cheaper than others, many professionals strongly suggest against shopping around for insurance based on cost. The small saving on cost may mean that you forgo certain benefits or provisions at claim time.
Some insurers offer perks that others don’t. For example, there is an insurer gives you the ability to earn “Airpoints”. A lot of customers like this as it means they can receive some form of a benefit for paying their insurance premium.
Check if the insurer offers the payment frequency you require. Some people for example prefer to pay weekly, but not all insurers offer this service.
Check if the insurer offers you the ability to deal with a financial adviser. If you deal with an expert financial adviser, in conjunction with working with a great insurer, this means you could also get really effective financial advice.
An insurer’s policy wording is along the lines of the ‘terms and conditions’. If the policy wording is of a very high standard, it generally means that the insurer has more lenient or widely encompassing terms that mean that you can more easily make a claim. Insurers with better policy wording generally give you policies which could have more opportunities to claim. Insurers with very poor policy wordings mean that it could be difficult to claim, or you could more easily be told you are not sick enough, etc. or not been disabled long enough at claim time.
You should also seek professional advice with regards to policy wording. You should not assume that an insurance company will pay out for anything and everything. These types of personal insurances can be much more complex than car insurance. For example, certain policies that have a income protection component do not pay (or pay less) if ACC pays. Whereas some others pay on top of what ACC pays.
Free benefits for kids
Some insurers offer free benefits for kids, such as a certain amount of free children’s trauma cover if the parent has a trauma policy. Check what the child might qualify for.
Financial strength rating
A company’s financial strength rating can help indicate its solvency and financial strength, which could have some indication on its ability to pay claims. Note however that a financial strength rating does not necessarily mean they are more easily going to pay your claim.
A company’s claims philosophy can help guide its mindset when paying a claim. If an insurer’s claims team is positively looking to find ways to help you claim on your policy, this can be very beneficial. It sure does work a lot better when the insurer has a ‘can do’ approach, as well as a great reputation with regards to its claims department or philosophy.
With types of insurance such as income protection, it can be helpful to consider what the insurer’s rehabilitation programmes are like. Some insurers go to greater lengths to help a claimant return to work and transition from a disabled state into one where they can function almost back to normal. Some insurers give you a claims manager, and additional rehabilitation support.
Check what other benefits the insurer might have. These can go a long way to making matters more comfortable in the event of the unthinkable. For instance; some insurance policies have added benefits such as when a person passes away, the recipient of the sum assured can receive some free money towards financial planning.
Where to get further help
Consider speaking to a financial adviser and working with them to understand in more detail. This article is not an exhaustive list of everything to consider when choosing a policy or insurer, but is given as a general guide to some of the many different areas to think about in arriving at that decision.