New Zealand Life Insurance

When considering term life insurance, ask yourself what financial impact your death or the death of your spouse or partner would have on:

• The surviving partner
  Consider the costs of repaying existing mortgages, hire purchase arrangements, funeral and legal costs. How much would you or your partner need as a capital sum or monthly benefit to continue to run the household, bring up and educate the children? Consider what you or your surviving partner’s emergency fund for three to six months living and also their retirement fund would need to be. Have you made a will?
• Children
  What impact would your death have on education funds or Overseas travel plans for your children?
• Your lifestyle
  What lifestyle changes would your surviving partner need to make if you died suddenly? They may need to sell current investments or require state funded benefits.
• Your business
  All business debt, including rental guarantees should be insured in the event of your sudden death. Consider what impact your death would have on your business partners. Have you got the necessary agreements in place?

Benefits of Life Insurance

Term life insurance will usually pay out:

• On death
  On death of the life Assured, (though suicide is normally excluded until the policy has been in force for thirteen months).
  
• Terminal illness
  If the life Assured has been diagnosed with a terminal illness and is unlikely to survive for twelve months, then up to 100% of the life cover is paid out.
• Bereavement support
  Some companies pay an early payment of the life insurance e.g. $5,000 as a lump sum, immediately upon notification of death, to assist family with travel plans, costs associated with arranging a funeral, grief counselling etc. This amount reduces the total life cover benefit paid by $5,000.

Term life insurance is an essential foundation of any risk management programme for anyone with a spouse, family or business partner that are dependent on them for their lifestyle.

TIP: Always have an up-to-date will in place 

This article was supplied by Fin Pavletich Insurance (www.totalcareinsurance.com), Independent insurance brokerage in Christchurch. Information contained in this article is of a general nature and is not intended as a substitute for professional advice based on your individual circumstances. It should be used as a guide only.