insurance

When the Insurance Company Says NO!

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What’s this? Even Brendon got turned down by an insurance company?! Here’s how it happened and some takeaways for us all.

 

My insurance company just said “no” to me. I am not happy. I am a current client of theirs and I sell their products to my clients.

 

I have personal insurances in place, but, in my annual insurance review, my circumstances had changed enough that I needed a bit or a re-org. I have existing cover (by this I mean life, income protection, trauma and health covers) at a number of providers and I was going to consolidate these and save a little money.

 

But when I applied I was declined. 

 

The reason for this was to do with my medical risk. 12 years ago I had a "neurological event" that looked a bit like a stroke. After investigating, they found that one of my heart valves "leaked" a bit (in the trade, it’s known as a PFO) I have had it all my life and, at the time, the best medical advice was to let it be. It wasn't a major issue—apart from the fact it could let an occasional blood clot through and in to my brain!?! Time has moved on and it seems that the medical advice may be changing. So, due to this uncertainty, my insurance company doesn't want to take the risk.

 

My immediate response was anger. 

 

How dare they? Don't they know who I am!? As well as the fact that I run ultra-marathons and so am pretty fit and healthy! I thought I was a pretty good risk. However, I do understand their rationale and I am now looking in to my medical options.

 

As well as working with my GP and a referral to a cardiologist, I may well use an expert’s (best doctors in the world) second opinion service known as "Best Doctors" that comes with my insurance. My health insurance may get a work out in the months to come. 

 

Watch this space.

 

Finally, some take homes from my experience:

 

There are two times when an insurance company might say “no”. One is when it comes to getting the cover in place. The second is at claim time. Trust me, it is far better to get a “no” at application time than at claim time.

 

At the risk of turning my little personal anecdote in to a sales opportunity …  our job at Velocity is to get the best cover, at the best price, and to ask all the questions at the start to ensure that, at claim time, the money arrives when you need it most.

 

Brendon Ojala is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

 

 


A Quick Guide to Personal Insurance

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Insurance can get confusing. Huge policy documents, insider lingo, fine print everywhere. It’s supposed to provide peace of mind, but can instead just play havoc with even the sharpest samples of grey matter.

So, here’s a 101 guide to understanding your personal insurance.

 

In New Zealand, there are four things a person can insure themselves for:

 

1. Life

 

Why? To repay debts, cover funeral costs and give your loved ones the financial freedom to properly grieve.

 

Who? This pays a lump sum to your estate or the person of your choosing.

 

2. Trauma

 

Why? Give yourself space to recover, whether or not you’re off work for a prolonged period of time.

 

Who? This pays a lump sum to you if you are diagnosed with a specific illness.

 

3. Income Protection

 

Why? Unfortunately the bills still come in if you’re unable to work due to injury or illness. This will pay a percentage of your income (or mortgage repayments) until you’re able to return to work.

 

Who? This pays you a monthly sum.

 

4. Health

 

Why? If you need non-acute surgery, you can skip the public queue and go straight to a private hospital.

 

Who? This pays the medical professionals that are looking after you.

 

Finally, it’s important to ensure that your cover is relevant to your life. Here are a few examples of life events that may impact the relevance of your cover. If any of these apply to you, give us a call!

•          You have new additions to your family

•          Your kids leave home

•          You get married and/or divorced

•          Your job changes

•          Your salary changes

•          You have had any health issues (more than just a GP visit)

•          You have set up a new company or trust

•          You have bought or sold a property

No investment decision should be taken based on the information in this blog alone

Baby on the way? This insurance can help

Debra and Dai encourage soon-to-be-parents to consider extra insurance as part of their nesting checklist.

 

Insurance typically isn’t the first thing that comes to mind when thinking about starting a family, let alone pregnancy or maternity cover. But, like most insurance policies, pregnancy insurance could save you money and give you piece of mind in case something happens to you during your pregnancy or even after you’ve given birth.

 

Being mothers ourselves, we have experienced both the joys of pregnancy and the excitement of becoming first-time parents. But it can also be an emotional rollercoaster for the mother as our bodies adapt to all the myriad of changes.

 

During this exciting time in your life, you may not be thinking about what challenges could lay ahead but let’s be honest we can never be too prepared and in this day in age, it pays to be.

 

So what is pregnancy insurance?

 

In most cases, New Zealand’s public health system is well equipped to deal with pregnancy and it’s unlikely you will need additional assistance if you have a normal pregnancy. However, in some circumstances, you or your baby may experience health challenges along the way and this is where pregnancy or maternity cover can assist. 

 

As an example of a scary unforeseen event that could happen, what would you do if your new born was diagnosed with cancer or has a major health issue that requires full time care? What would happen to your income? Would your spouse be able to take care of you and your baby and look after your household expenses? These are all things we don’t want to think about, but, tragically, these situations do occasionally occur. Thankfully there are additional insurance options available to assist you through it or just give you peace of mind.

 

There are a number of insurance companies who offer additional pregnancy or maternity benefits that will cover certain medical bills due to pregnancy complications. And, if your child becomes critically ill, some insurers will also pay you or a family member to take time off work to care for your sick child.

 

When these sorts of events occur, the last thing you want to deal with is financial stress. Knowing what is out there and making a plan to get appropriate insurance for you and your family could be just the sort of peace of mind you need before tackling this new chapter of life.

 

If you would like more information, please contact our office and we will be happy to discuss the options with you.

 

Debra Halton is a Registered Financial Advisers with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

 

How this Earthquake has Affected Insurance

It’s that time of the year again ... earthquake season. And Graham points out that the ground moving beneath us isn’t the only thing to be concerned about if you’re a homeowner.

As of today (Tuesday 16 November), while recent events cause us to again think about house insurance, there is an embargo against any new house insurance being issued by New Zealand insurance companies. This will remain in place until the powers that be work out what is what in regard to the on-going earthquake issues.

The implication of this is that you can only buy a new house if you can get the existing insurance that is on the property transferred across to the new owner’s name. If you can't, then banks won’t release mortgage funds. This is not a new situation as it occurred in Christchurch and also in Wellington following our last big shake.

The way forward will become increasingly clear over the next few days as the aftershocks hopefully abate.

For all of us who are a little exhausted after the last few days there are lessons to act upon. On a practical level, photograph all the relevant damage in your property, things like cracks and shifting. Go over the house a couple of times as we often miss damage at a first glance.

Finally, we’d like to send our love and support to all those in the South Island who have been seriously affected and those in Wellington who can’t get back into their homes or offices.

 

Graham Goodisson is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

 

Why Your Insurance Company Wants to Act Fast on Your Behalf

It can surprise many how willing good insurance companies are to pay income and health insurance claims and their promptness is all for good reason: because, for them (and for you), a doctor at the top of the cliff is better than an ambulance at the bottom.

 

More claims would be paid and more people helped if insurers knew more about what was up with their clients’ health. For example, it’s estimated about 30 per cent of all income protection claims are related to mental health issues (and this statistic is slightly higher amongst the self-employed). So, what the insurers want to do in mental health claims is to intervene quickly, and, if possible, put support structures in place before things get really out of control.

 

This early intervention strategy is actually good business for the insurer. The sooner you get help in a claim situation, the better, because the claim might be much smaller if the issue is dealt with promptly rather than left to snowball. In this way, insurance companies spend money in the short term to save more money in the long run.  

 

So, this is where your doctor comes in. If you are unwell, without wanting to sound tactless, please tell us what your doctor has told you. This will allow us to see if we can get some more support from your insurer and assist in the road to recovery.

 

It’s a win-win: You get help faster and stay healthy; the insurance company saves money.

 

Graham Goodisson is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

 

 

Meth Houses, Landlords and Insurance

Media is hyping up meth houses as potentially being take two of the leaky homes saga. Graham presents some tips for landlords on getting your insurance on track to reduce the risks of being stuck with a meth house rental.

 

If you search on Stuff.co.nz for “meth houses” you come up with a long list of headlines. One of the top five is the Real Estate Institute’s comment that meth houses could be as big a problem as leaky homes in the future.

 

That’s a big call and I don’t know if I agree with it. But it certainly emphasises the fact that meth houses are a growing problem that we, as landlords, need to be aware of and manage.

 

One of the main things to consider with the risk of meth houses is how your insurance company treats the issue. 

 

Firstly, your insurance company needs to know that your house is tenanted in the first place. Second, make sure you have landlord’s protection cover and/or extensions that cover you. Third, it is imperative that you inspect the property every 90 days and that there is documented evidence of this (a property inspection report). If there is not, you may well not be covered.

 

All this emphasises the point that it is a good idea to have your property professionally managed (I know of very few, if any, private landlords who are disciplined enough to do regular inspection reports). And, to put it in context, giving up 10 per cent of your annual rental to a property manager looks pretty cheap in the face of potentially being hit with a $30,000 meth clean up bill.

 

My prediction is that, in the future, tenancies will need to have a certificate of meth cleanliness and these may well accompany house sales. In the meantime, cover your basis with good insurance and regular property inspections.

 

Graham Goodisson is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

Free Range Kiwis?

Lance discusses why, when it comes to personal insurance, a little outside input can go a long way, even for us number-eight-wire minded Kiwis.

 

Us New Zealanders are travellers and pioneers. Our ancestors are people who were not content with what was put in front of them so set sail and explored. We explore new horizons and opportunities. 

 

Thanks to this pioneering mentality, we tend to have also a “do not tell us what we have to do” (or cannot do!) type attitude. We like options, we are free range Kiwis and we like to make decisions based on investigating what is best for me and or my family.

 

I read an interesting article in the Dom Post recently entitled “Who Needs an [Insurance] Adviser Anyway”. It spoke on the importance of finding an adviser who can offer  professional advice which will meet the specific needs to a client. It emphasised the massive benefit of having an adviser who has access to a wide variety of insurance providers and who takes the time to explain the technical aspects of personal insurance cover and how it works.

 

This article also highlighted the importance of choice. If you purchase personal insurance from the bank, for instance, they will generally only have products from one company to squeeze your individual needs into, and they often present only a watered down version of that one choice!

 

Banks are amazing sales people, they have to be, but personal insurance isn’t a one-size-fits-all business so it pays to channel that pioneering and adventurous spirit into seeking out an insurance adviser that can lay out some good options on the table.

 

So here’s some advice for Kiwis on the hunt for personal insurance:

 

1. Speak to a professional insurance adviser. Have them find out about you, your current situation as well as future plans.

2. Let the adviser display the options and find the insurance company that best fits you.

3. Review your insurance strategy annually to make sure your cover is exactly what you need and make any appropriate changes.

 

Lance Shearman is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

The Rise and Rise of "Give a Little" Websites

Everybody loves a cheerful giver, but should you bank your family home on your mates bailing you out? Brendon shares his thoughts and frustrations.

This blog may get me in trouble but this is what I think: sometimes when I'm asked to donate on “Give a little” style websites, I get grumpy.

My heart should be filled with compassion. However, that's not always the case. Don't get me wrong, I'm not a cruel, heartless beast and I know that there are some situations where terrible things have happened and there has been absolutely nothing the people involved could have done about it. So please hear that … and I will join you in giving to those causes…

However…

One of the things I do at Velocity Financial, as well as helping people get into property through brokering home loans, is to advise about the risks involved in having debt and actually just living in a modern world. I then provide a way to mitigate that risk and, yes, that solution is insurance.

So I spend lots of my time talking to people about the financial risk of unexpected events occurring. These are the kinds of stock standard request you’ll see on a “give a little” site, requests like the death of the family breadwinner, cancers, strokes, injury causing car crashes and lots of other really unpleasant and terrible things.

A percentage of the people I speak to “don’t believe in insurance” or just don’t get around to sorting it out. This is fair enough if there is a solid plan B in place (like assets that can be quickly liquidated—I’m not sure if selling the family home is the best plan B in the world). However, all too often, plan B is “My family and friends will help us out”, which is another way of saying, “I don’t actually believe those terrible things will ever happen to me.”

And here is the source of my grumpiness … There are far too many people who have had terrible things happen to them who should have and could have done something about it … but they didn’t. They now need their mates to have a fundraising concert or start a “give a little” page.

Of course I have a vested interest in people taking insurance and I fully acknowledge that. I also apologise if I sound a little too evangelical about this(my mother may be proud that I still have an evangelical streak left in me) but I don’t think that makes my observations any less valid.

Comments gratefully received

Brendon Ojala is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.

What are Your Chances of Needing Insurance?

Do you actually need personal insurance? And what are the chances that you are unable to work due to illness or injury? Graham, our resident stats man, tackles these big questions head on.

I just finished another conversation with a client around how to pay their mortgage off quickly and then how they can buy another property in the next three years. We talked about their personal budgeting in order to manage expenses but we also talked about their ability to continue to earn an income.

 

At this point in the conversation—the point when the topic of personal insurances arises—many clients’ eyes glaze over and they switch off. Ultimately, it’s a case of "it will never happen to me” syndrome. 

 

So what are the chances?

 

If you are a couple aged 30 or upwards, there is a 17 per cent chance that one of you will die before the age of 65. Slightly under 10 per cent chance one of you will suffer a total or permanent disability before 65 preventing you from working again. 25 per cent chance that one of you will suffer a critical illness e.g. cancer, heart attack, stroke. 27 per cent chance that one of you will take at least six months off work before the age of 65. 

 

These figures may sound a little high but if you have a quick look around your circle of friends or your parents’ friends and make a list of people who have been affected you’ll realise that they are actually pretty accurate. And for a little under three per cent of your annual salary you can financially protect you and your family to lessen the impact if one or more of these events occurs.

 

The figures are the figures are the figures!

 

Give us a bell today to chat about insurance options for you and your family.

 

Graham Goodisson is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.