• They manage claims for you

Your broker will continue to work for you after the initial policy purchase, helping with making claims or changes to your policy. The claims-making process can be stressful, so having someone already familiar with the process take care of it is a huge weight off your shoulders.

• They save you time and energy

Modern life is busy. We don’t all have time to spend hours researching the pros and cons of different policies. Insurance brokers save you time and energy by doing the research for you.

• They save you money

Brokers have bargaining power and may be able to negotiate with providers on your behalf. At the very least, they should be able to ensure that you’re getting the best deal for the policy that you need.

• They can provide more tailored, personalised policies

When you buy an insurance policy online, you are purchasing a cookie-cutter policy that is designed to fulfil the majority of your needs, but ultimately may not be the perfect fit. Working with a broker means that you can get the specific coverage that you need in a more tailored, personalised package.

• They continue to work for you

Insurance brokers can continue to review your policies as your situation changes, making sure you continue to have the right coverage. They can also advise on how your sum assured amount should change to reflect changing living situations so that you’re not paying a higher premium than necessary.

What are the Drawbacks of Using an Insurance Broker?

Brokers don’t have access to all insurance providers so can only set you up with policies from the providers they work with. You should ask which insurance providers a broker works with before taking on their service, and factor that into your decision when choosing a broker.

What Qualifications do Insurance Brokers Need?

Insurance brokers/advisers fall under the umbrella of providers of financial services, and as such are regulated by the Financial Markets Authority (FMA).


Insurance brokers in New Zealand are required to have their New Zealand Certificate in Financial Services (Level 5), as well as a Financial Advice Provider licence.

There are no degree-level courses insurance advisers need, though they often have a background experience in related areas, for instance, accounting or business.

In March 2021, the financial advice regime made some changes to how insurance brokers operate in New Zealand, holding them to higher standards of accountability and transparency under a new Code of Professional Conduct.

Under the new regime, there is no tolerance for conflicts of interest, brokers are required to take measures to ensure that customers understand the information being presented to them and its limitations, and they must comply with new disclosure obligations. All brokers now need to be operating under a licence, and overall, the needs of customers are prioritised. What this means for you is that you can be even more sure that the services you receive from an insurance broker are in your best interests. If there’s anything you’re not sure about, be sure to ask, as insurance brokers are obliged to answer all of your questions.

What do Insurance Brokers Cost?

Using an insurance broker/adviser is usually free in New Zealand. They are paid on commission from the insurance provider once they sign you up.

Some brokers charge a fee that is roughly equivalent to the commission that they would get. Others charge a small fee ($50-100) on top of their commission depending on the type of insurance you are taking out.

Insurance advisers should always let you know how they are paid: don’t be afraid to ask if this isn’t clear to you. This is a requirement in their disclosure to you as part of their service.

There are four different types of commission:

• Upfront commission: a commission that is paid as soon as you are signed up for a policy.

• Trail commission: an ongoing commission (smaller amount) which is often paid yearly to the broker for the help and assistance with your ongoing needs, and changes that may be required to your policy.

• Bonuses: paid for meeting criteria, such as the number of policies sold or retained.

Some insurers will ask for a commission from a broker to be returned if you cancel your policy within two years. Insurance brokers sometimes deal with this by passing the cost onto their customers: this is something to ask your broker about before you sign up for anything.

What Should I Expect From My Insurance Broker?

Your broker should explain to you how insurance works, and discuss your specific situation, budget and your goals when it comes to the policy.

You will need to explain what risk you want to protect against, and in the process, you will probably end up discussing your income, age, health status, any previous policies you have had and how much you can afford to pay in premiums.

If you want health insurance, are there any particular diseases or illnesses you want protection against? Your broker may be able to guide you towards policies that provide good coverage of those conditions, while leaving out those you don’t feel you need insurance for.

To get the best from your broker, it’s important to be honest, for instance about any pre-existing conditions you have.

When it comes to choosing a provider, talk to your broker about which companies they have experience with, and how they have handled claims in the past. Your broker should do the shopping around for you and compare offers from different providers while taking your budget into account.

If you already have an insurance policy and the broker recommends that you switch, make sure you discuss all the potential points of difference with them. One area that is important to consider is if there are any pre-existing conditions you have that will not be covered in the switch as that could leave you exposed to more risk.

As with any financial adviser, your insurance broker should provide you with clear advice that is easy to understand, and you should feel comfortable asking them questions if there’s something that does not make sense.

If you feel uncertain about your broker and you’re not able to resolve your concerns with them, you shouldn’t feel obliged to continue receiving their advice.

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Your Options if Things Go Wrong

If you are unhappy with the services your broker provided, the usual course of action is to contact the broker directly first and try to resolve the issue yourself. If you don’t feel the issue has been resolved, the next step is to take it to a dispute resolution scheme. Every financial adviser in New Zealand belongs to one of four schemes:


• The Banking Ombudsman (solely for banks)

• The Insurance and Financial Services Ombudsman

• The Financial Dispute Resolution Service

• Financial Services Complaints Ltd

The dispute resolution process is similar to arbitration. You won’t need any lawyers or have to pay court costs, and both parties agree to abide by the decision made.

How do I Find an Insurance Broker?

There are many insurance broker services throughout the country, from large companies such as Mike Pero, to small one-man-bands. A quick Google search will come up with multiple pages of options. Who you choose to go with will depend on the kind of service you want and who you feel comfortable with.

Here at Quashed we provide one of the quickest and most convenient adviser services.

To take advantage of this free service, sign up to the platform today.

Quashed also provides a free Market Scan tool, which allows you to compare your current insurance policies to others on the market.

Hopefully, you have found this information helpful. If you have any questions about the process, check out our FAQ.