Do I need life insurance in New Zealand?
Life insurance has become much more common in New Zealand1, so it could be worth looking into according to a lot of fellow Kiwis (that’s us – not the birds). Having cover in place can make sure your family’s financial future is sorted out in case of a tragedy. But even if you don’t have kids or other dependants, there’s nothing wrong with thinking about yourself once in a while!
If you’re thinking about whether or not you need life insurance, consider if there are any people who rely on you financially. If you have a family to support, could they afford to live without you? You can answer that by adding up the expenses they would face if you weren’t around. Start with the common things like:
- a funeral or tangi
- school fees
- the mortgage
- miscellaneous debts.
While you’re at it, you might want to consider their general lifestyle by factoring in enough money for:
- home renovations
- a new car
- a holiday, or
- the occasional fish and chips dinner.
These expenses can add up to a lot of money over a lifetime which is why life insurance might be a good call. It can make sure your family isn’t left hanging with the financial impact if you passed away.
If you live on your own or don’t have a family to provide for, you could still find life insurance useful for yourself. This can cover you for and help you cope with unplanned curveballs like a serious illness or permanent disability that stops you from living independently. But keep in mind that not all policies will cover these events so you’ll need to shop around for cover that suits you.
Here’s a quick rundown of how life insurance works in New Zealand and any local factors you might want to consider before signing up.