Life Insurance Benefits

Insurance protection can come in many forms as follows:  Please ensure to check your policy document for full policy wording, terms and conditions as these are summaries only and benefits may vary.

Life Assurance:

This is where the sum assured (the insured amount) is paid upon the death of the person insured.  Some companies will pay out the full sum assured if the life assured gets diagnosed as terminally ill and will most likely die within 6 to 12 months.

Trauma Cover (also known as Living Assurance, Critical Care and similar names):

This is where the sum assured is paid upon the person insured contracting one of the qualifying conditions set out in the policy document.  Death does not need to occur just contracting one of the conditions which can vary between companies from 27 conditions to about 42 conditions.  Some companies will also provide a diagnosis benefit where as soon as you are diagnosed with some of the qualifying conditions, you will be paid part of your insured amount immediately.  For example, Parkinson's Disease is a degenerative condition and it may take some time to reach the full definition, so this is where a "Diagnosis Benefit" is important.

T.P.D (Total and Permanent Disablement)

This is where the sum assured is paid when the life assured has been diagnosed that he or she is so incapacitated and has been for a continuous period of 6 months that he or she is unlikely ever to be able to return to work.  Some companies will also provide a T.P.D benefit within their Trauma Cover.

Income Protection:

If you were unable to work and earn an income due to sickness or accident would happen to your partner, children, business, home or lifestyle? Would you be able to pay the mortgage, the monthly bills and meet your children’s schooling expenses?  How long before your savings would run out? Life can be a risky business – that’s why it is necessary to protect your most valuable asset – your ability to earn

Available to employees as well as self employed and options include payments towards rehabilitation, occupation re-training etc.

Agreed Value / Indemnity

Agreed Value policies typically provide a monthly benefit of an amount set at the time the policy is taken out, to a maximum of 55% of your earnings.  This type of cover is usually the preferred option for people who have no problem supplying earning details at the time the policy is taken out.  Agreed Value benefits are usually not taxable.

Indemnity policies typically provide a monthly benefit of 75% of your earnings prior to disablement.  This type of benefit is taxable and is usually the preferred option for self employed people who have trouble providing earning details at the time the policy is taken out.

Redundancy

You may cover your mortgage instalment or up to 40% of your gross income (Whichever is the greater) in the event that you are made redundant (Not Voluntary)

• Must have been in the work force for 6 months
• Must have no prior knowledge of impending redundancy
• Policy in place 6 months before a claim accepted
• Wait period of 4 weeks before first benefit payment made
• Benefit paid up to six months or when back to work, whichever is the earlier

Mortgage Repayment Insurance (Monthly Benefit):

This is specifically for your mortgage repayment, so if you are not able to work due to sickness or accident, then the insurer will pay your monthly benefit towards your mortgage payment and usually this insurance is not offset by any other ACC benefits you may be receiving.

Health Insurance (also known as Medical Insurance):

This is where the insurer will pay for private health treatment and you can bypass most waiting lists and get the treatment you require.  You can also add optional Specialists and Tests to your cover which will provide more comprehensive cover and will pay for Specialists and Tests visits if your visits do not lead to hospitalisation.  Most of the time if you visit a specialist or have tests done, and these visits and tests lead to hospitalisation within 6 months, then these costs are normally included in your base hospital cover.

Family Protection Benefit:

This is where the life assured can insure for an amount which will be paid as a regular monthly income to the policy owner.  For example, let's say you are age 40 and if you died you want to make sure your family a regular monthly income for a pre-determined amount.  So in this example, you are age 40 and want to leave your family $4000 per month for 10 years.  You can obtain a Family Protection Benefit which will do this.  The main benefit of this type of insurance is that it will provide a stable and regular income to the family which increases with inflation during the benefit period.  In the past people would have to insure for $480,000 ($400 X 12 X 10 = $480,000) and the surviving partner would have to be VERY wise to ensure that these funds were not used incorrectly and that the fund were not allocated to any high risk investments or making emotial decisions what to do with the $480,000 during a very emotional and stressful time.  The family protection benefit removes all these risks and pays a regular stable income.

THIS IS A SUMMARY ONLY INTENDED TO PROVIDE YOU AN IDEA OF THE TYPES OF COVER AND SHOULD NOT BE TAKEN AS ADVICE, PLEASE CONTACT US FOR PERSONAL ASSISTANCE.