Protection insurance — what do you need?
We never expect the worst to happen, but if it does, having the right insurance in place can protect your home and family and enable you to maintain your quality of life.
We always recommend you look at protecting your family, your income, and your assets. Your individual insurance needs will be personal to your own situation and will change during different stages of your life.
If you’re buying a new home with a mortgage we recommend you consider some kind of protection insurance to ensure you keep it should the worst happen. But what kind of protection insurance do you need?
When someone dies suddenly it can leave the immediate family in a tough situation. They may struggle to pay the bills, mortgage and day-to-day living costs. Life insurance is designed to protect your loved ones against financial loss to the household.
Life insurance can protect the surviving partner of a relationship and any children. You can choose your level of cover appropriate to your personal situation — you may want to leave a mortgage-free house, cover your funeral expenses, and maybe your salary for a year or more to make life easier for your family.
Life insurance takes the financial pressure off a family during an already emotionally stressful time.
Income Protection Insurance
If you got an illness or injury that prevented you from working would you still be able to pay your bills and live your lifestyle? Most of us don’t have enough money saved to cover this type of scenario if it happened. That’s where income protection insurance can be helpful, especially if other family members are reliant on your income. It will pay you a regular amount until you are able to return to work.
ACC does not cover illnesses and most people do not have enough sick leave to cover an extended period of illness. Income protection insurance can cover that gap while you recover.
Mortgage Repayment Insurance
When taking out a mortgage or increasing your lending, it’s important to consider how you would continue to pay it back if something prevented you from working. This cover can help to pay the mortgage in the event you are unable to work due to illness, injury or disability. You can even add a redundancy cover to it.
Mortgage repayment insurance has some benefits that differ from income protection insurance — the payment you would receive from a claim is not reduced if you are also receiving a payment from ACC. It can also be useful to protect a homemaker or stay-at-home parent against any loss suffered or extra costs incurred if they aren’t able to fulfill their normal duties.
Getting it right
Choosing appropriate and affordable personal insurance cover can be extremely complex. You might only choose one of these options, or reduce some of the optional extras to create a cover that is both adequate and affordable for you and your family.
Whatever your circumstances, we encourage you to get personalised advice on your specific insurance needs. We can help make that process easier by connecting you with our specialist insurance adviser for a free risk review. They will discuss your needs, explain and quote on your options, and answer all of your questions. Call us now to get started.