Think of what would happen if you suffered a permanent disability that stopped you from living independently. If you’ve become used to living alone, having life insurance could help you pay for private care or other medical arrangements to help you stay at home, instead of having to move into a care facility. Plus, you won’t need to worry about these expenses hurting your future financial goals. That’s why some life insurance policies come with optional TPD insurance (that’s Total & Permanent Disability). TPD cover gives you a fixed lump-sum payout if you suffer an illness or injury that prevents you from being able to work in any occupation again. You can use this money to pay for treatment, private care, or other medical equipment that helps you stay self-sufficient in your everyday needs.
Money won’t make up for lost health but remember that medical innovations are always getting better at reducing the effects of some conditions. So even if you’re single and don’t have financial dependents, having cover in place can help you put your life back together after a major health hurdle sets you back.
Life Insurance for young duos
Young, hopeful and curious – couples without kids make up over 40% of New Zealand’s population.2 If you’re part of that band, it’s good to think about what the future holds for your relationship and financial situation.
If you’re not planning to have kids, the biggest expense you’ll need to stay on top of as a couple would likely be housing and rent. New Zealand is a stunning place to live but it’s not always an affordable one – the national average for renting a small home (1 –2 bedrooms) is at least $390 a week. If you’re set on city life, the average rent in Auckland is $600 a week and can even go as high as $850.3 You can expect to pay even more for a mortgage so the financial blow of you or your partner passing away would be tough without life insurance. There’s also the possibility of one of you suffering an illness or permanent disability. Dealing with such a big challenge while you’re still young and haven’t accrued much wealth can leave you or your partner in tough times when medical costs start piling up. Life insurance at this stage can help you protect both your current financial plans as well as any plans you might have in the future, like having kids and starting a family of your own.
Life Insurance for the merrily married
Tying the knot is expensive in New Zealand, even without the lavish wedding. Married couples have a lifetime of costs on the cards which usually require two incomes to cover. From buying your first home to building wealth for the future, life insurance can make sure your financial commitments don’t go to waste if life takes a wrong turn for you or your partner.
A wishing well in lieu of wedding gifts can help you start a savings account for your first home, but decades of repayments mean you’ll need to have a steady income for the years ahead. Recent data from REINZ shows the 2019 median house price in New Zealand was $580,000. If you’re looking to settle down in Auckland, you can expect to owe around $820,000 on your mortgage.4 Tough go.
The biggest worry for married couples with a mortgage is the co-dependence in making repayments. If something happens to either you or your partner, your household income will be cut in half which could make it hard to adapt financially. Taking out life insurance can help you prepare for hard times in the future and protect what you’ve worked so hard for up to this point. This is even more important for young couples who haven’t built up enough wealth to deal with big financial setbacks. Taking out life insurance cover early in your marriage will let you confidently plan for the future and reduce the risk of leaving the person you love in hardship.