Why sorting personal insurance is more important now than ever - The Prosperity Project

People are being urged to invest in personal insurance, rather than adopting a she'll be right attitude. Photo / 123RF

A she’ll be right attitude and a distrust of insurance companies are among the reasons why more New Zealanders don’t insure themselves, according to one broker.

New Zealanders have low levels of coverage from policies like life, income protection, trauma and total permanent disability.

National Insurance Lead at Advice First Willie Moala told Nadine Higgins on The Prosperity Project podcast that there are a number of reasons why more people don’t have personal insurance.

“A lot of it is ‘the state will look after me’, but I also think it’s probably more from the ‘she’ll be right’. So when they say that the state will look after me, I think that’s just a bit of a cop out because they just don’t really want to think about it”.

While New Zealand’s ACC scheme will cover 80% of a person’s income when they’ve been injured as a result of an accident, there’s a lot it doesn’t cover, which people don’t necessarily consider.

“If you think about a stroke - a severe stroke - for most of us, that would mean we’re never returning to work again. So, in that case, ACC is not coming to the party,” Moala says.

Moala recalls one couple he saw with two school-age children, who were preoccupied by saving for a house and getting set up for their future, and, despite several meetings with him, opted out of getting insurance.

He didn’t hear from them again for four years, until he got an email he said was “filled with regret”.

“The partner that had emailed me was diagnosed with terminal cancer, and so what that meant for them was they were basically left without any support system and the financial worries picked up really quickly.”

He also thinks there’s a degree of mistrust that insurers will honour claims that stops people from securing cover.

“[That] is a real shame because I’ve been in this industry for 15, 16 years and I have seen nothing but absolute determination from the insurers to try to find ways to support people when they need it”.

Moala says, right now, there probably isn’t a week that goes by when he doesn’t receive a question about redundancy cover.

“I don’t remember a time where people have asked me more redundancy questions”.

Price is also a barrier for many people to securing insurance, but he says there are a number of ways to improve the premium you pay, like making lifestyle changes to remove premium loadings.

Listen to the full episode of The Prosperity Project for more insight into the types of insurance, and which ones to prioritise to best protect your family.

The podcast is hosted by Nadine Higgins, an experienced broadcaster and a financial adviser at Enable Me.

You can follow the podcast at iHeartRadio, Apple Podcasts, Spotify, or wherever you get your podcasts. New episodes are released every Monday.