When it comes to safeguarding your family’s future, life insurance is one of the most crucial safety nets. Let’s face it: figuring out whether you need it, how much to get, and who to trust can feel like unraveling a tricky movie plot twist. The good news? It doesn’t have to be that complicated. We’ve simplified everything to help you make an informed decision about life insurance—and to show you how Quashed makes finding the best option easier than ever.
What is life insurance?
Here’s the revised version with the changes applied: At its core, life insurance is a financial safety net for your loved ones. If the unexpected happens and you’re no longer there, a life insurance policy provides a lump sum payment to your chosen beneficiaries. This money can help with:
Covering everyday expenses (e.g., groceries, bills).
Paying off major debts, like a mortgage.
Funding your children’s education.
Covering funeral and medical costs.
In simple terms, life insurance ensures your family’s financial security—no matter what life throws their way.
Do I need life insurance?
New Zealanders are among the most underinsured in the developed world.
According to the Financial Services Council (FSC), only 41% of Kiwis have life insurance, and a staggering 4 in 5 lack income protection insurance. This gap leaves households financially vulnerable, especially if the primary income earner is unable to work due to sickness, disability, or death.
Imagine you’re a young parent in Wellington with a $400,000 mortgage and two kids under five. Without life insurance, your partner might struggle to cover the mortgage, school fees, and daily expenses. That’s why life insurance isn’t just about planning for the worst—it’s about ensuring financial security for you and your family.
How much life insurance should I get?
Now that you understand why life insurance is important, the next question is: how much do you actually need? The answer depends on your individual situation. Here are some key factors to consider:
Your debts: Include your mortgage, credit cards, and personal loans.
Income replacement: How much would your family need to replace your income for 5–10 years?
Future expenses: Consider education costs or major life milestones for your kids.
If you’re unsure, a common rule of thumb is to aim for 5–10 times your annual income. The good news? Quashed can help you calculate the right amount based on your unique circumstances, taking the guesswork out of the equation.
What should you look for in a life insurance policy?
When comparing life insurance policies, it’s important to focus on these key factors to ensure the policy meets your needs:
Coverage: Does the policy cover essential situations like trauma, terminal illness, or accidental death? Make sure it aligns with your specific concerns and financial goals.
Flexibility: Life circumstances change—can the policy adapt? Look for options that allow you to adjust your coverage as your needs evolve, such as when you buy a home or have children.
Premiums: Are the premiums affordable within your budget? Determine whether the policy offers level premiums (fixed over time) or stepped premiums (which increase with age) to suit your financial planning.
Reputation of the provider: Does the insurer have a strong record of paying claims? Research reviews, ratings, and claim statistics to ensure you’re working with a trusted provider.
Taking the time to understand these aspects will help you choose a policy that provides both financial security and stability. For more tips, check out our blog.
How Quashed makes life insurance simple
We know insurance can be overwhelming, so we’ve made it our mission to simplify the process.
Here’s how Quashed helps:
Compare policies in one place: Browse options from leading insurers, all in one easy-to-use platform.
Key details at a glance: No jargon—just the essential info to help you decide with confidence.
Easily explore options: Find policies that align with your budget and coverage needs.
Save time and effort: Compare policies side by side in minutes—no need to search multiple sites.
Perks: Some insurers offer extras like discounts on gym memberships and wellness programs.
Ready to get started?
Life insurance isn’t just a policy—it’s about protecting what matters most to you and your family.
Whether you’re starting out or planning ahead, the right cover can make all the difference.
Sign up now and start comparing life insurance policies with Quashed.
Further reading
Want to dive deeper into life insurance? Here are some good reads:
Life Insurance Through Our Life Stages: Discover how insurance needs evolve over time.
How to Choose Life Insurance: Key considerations in choosing life insurance.
Cost of Life Insurance: Understand what influences life insurance costs and how to make it work for you.
Save on Life Insurance: Learn how to lower premiums without sacrificing coverage.
FAQs
How do I choose the right life insurance policy?
Choosing the right life insurance policy depends on your individual needs, lifestyle, and financial situation. Start by assessing your financial obligations, like mortgage payments or dependents, and think about how much coverage you need. Consider premium affordability and flexibility to adjust coverage as your needs change. While these steps provide a good starting point, choosing the right life insurance policy can be complex. For personalised guidance tailored to your specific situation, consider seeking advice from a qualified financial adviser or insurance professional.
What should I know about life insurance providers in New Zealand?
When choosing a life insurance provider, consider their reputation, customer reviews, claims history, and policy options. Some providers specialise in specific types of coverage, while others offer broader choices. Comparing providers can help you find one that suits your unique circumstances and budget.
What is the 'Sum Assured' in a life insurance policy?
The Sum Assured is the amount you choose to insure yourself for. This is the amount that would be paid out to your beneficiaries in the event of your death. It differs from the 'sum insured,' often used in other types of insurance, which refers to the maximum coverage limit but may not always reflect the payout amount.
What is a 'Wait Period'?
The Wait Period refers to the time your policy must be active before coverage takes effect. For example, certain claims may not be eligible for payout if the insured dies within this period. It ensures insurers are protected against claims from pre-existing or undeclared conditions.
What is meant by 'Exclusions' in a life insurance policy?
Exclusions are circumstances in which your life insurance policy does not provide coverage. Common exclusions include death resulting from high-risk activities, breaking the law, or specific medical conditions not disclosed during application.
What does 'Renewal' mean?
Renewal is the continuation of your policy from one term to the next, provided you’ve kept up with premium payments. Most life insurance policies renew automatically, ensuring uninterrupted coverage.
What is 'Premium Loading' in life insurance?
Premium Loading refers to an increase in your life insurance premium. This happens when there is a higher risk of death, injury, or disablement due to factors like age, pre-existing medical conditions, or engaging in high-risk activities.
What is the 'Duty of Disclosure'?
The Duty of Disclosure requires you to provide your insurer with all relevant information about your health, lifestyle, and family medical history. This includes disclosing your age, gender, smoking habits, dangerous hobbies, and occupation. Providing incomplete or false information can result in claims being denied.
