Before you buy life insurance, stop. To make the best purchase for you and your family, there are five key things you should know before you buy life insurance. Today we’re discussing them with you.

5 Key Understandings to Learn Before You Buy Life Insurance

The NZ Herald published an article titled Six Biggest Life Insurance Mistakes Kiwis Make. It emphasised that life insurance is often purchased because an event has occurred, such as getting a mortgage or having kids. Maybe because people are consumed with thinking about these events that they make these mistakes, but we don’t know for certain. However, we do agree that they are mistakes you should know about them before you make them! So, in a way, our five key understandings on buying life insurance could be thought of as five ways to avoid making big mistakes. They are:

1. Know what’s covered and what’s not – those sneaky pre-existing conditions may not be covered by your new provider, nor may your high adventure activities, should the worst happen to you. Before you sign up, check if there are any exclusions!
2. Personalise your cover – not everyone needs the same cover. As your insurance advisor, we will work with you to identify the best $ amount for your policy cover.
3. Find out about the qualifying period – when taking out new cover, know that there may be an exclusion period at the start where you may not be able to claim. While you can’t do much about this if it is your first life insurance policy, if it is a replacement, consider keeping your old one active until this period ends, or negotiate with your new provider about waiving the stand down.
4. Understanding the four roles in policy – it’s not just you taking out life cover. Instead, there are four other players involved too. The insurer is the insurance company the cover is with. The owner is the person who pays the insurance premiums. The insured is the person whose life is covered by the policy. The beneficiary is the person who would receive the policy pay-out should the insurer die.
5. Check the fine print – the definitions of terms in your policy can vary depending on the provider you select. This means you should understand what your policy says before you sign. By using us as your insurance adviser, we’ll do the reading for you and explain what it all means in layman's terms.

The best life cover is a product chosen and tailored specifically to meet your needs. We can do this for you. Book a time to chat with us today and together we’ll get you covered.