Getting your insurance sorted can feel a bit like decluttering your home; you don’t usually feel like it, but once you’ve done it, you feel a calm sense of satisfaction, knowing something important’s been accomplished. But just what type of insurance does your family need?
While it might not seem as important as spending quality time with your loved ones (or decluttering the kitchen pantry!) making sure your family is correctly insured could be just as vital!
I know, insurance can get confusing. There’s just so many different types. Home. Contents. Mortgage. Life. But what kinds of insurance do you really need to make sure your family is covered in case of a disaster?
What type of insurance does your family need?
Life insurance isn’t something we like to talk or even think about. But if anyone relies on you financially, then you need life insurance. If you’re the main breadwinner of the household then the last thing you want to do is leave your family in a financially vulnerable position.
Purchasing a good life insurance policy is one way of preparing for the worst possible ‘what if’.
If tragedy were to strike and either you or your partner were to pass away, you’d know that your family would be looked after. In most cases people choose a level of cover that will pay out enough to cover funeral costs, provide financial assistance for a few months or even clear the whole mortgage.
This means that while they may no longer have you, they will at least have the security of a home without the stress of a mortgage to pay.
In most cases there’s also an option for an early pay out if you’re diagnosed with a terminal illness. This allows you to receive a lump sum payment to do whatever you want with; use it for treatment or travel – ensuring all family members can be close at a difficult time.
In New Zealand we’re pretty lucky. We have access to free public healthcare. And while many say that things could move faster, in a lot of ways our medical care is some of the best in the world.
In fact, based on information from the 2016 Best Countries Rankings, New Zealand’s public healthcare system sits modestly at number 10 in the world.
As good as our health care system may be, when it comes to a serious illness the best course of treatment is a swift one. Sitting on the public waiting list is no way to go about winning a battle with cancer.
That’s why private health insurance is a great option for you and your family. Not only do you get to jump the queue by opting for private care, you also get quick access to treatment options that would otherwise potentially cost thousands.
Home and contents or Renters insurance
If you own your own home it’s just basic common sense that you’d want to protect it against damage. This could be damage in the form of fire, flood or natural disaster.
But it could also be something simple – like the kids leaving the bath running and destroying the carpet, the teenagers having an impromptu party while you’re away and destroying…everything!
In most cases a good home and contents policy will see you through whatever life and Mother Nature choses to throw at you.
When it comes to renting it can be easy to forget about insurance all together. But even though you don’t own the home you’re living in, insurance is still vitally important to ensure your family is protected against the unexpected.
In most cases the home owner or landlord will have some form of insurance protecting the house in case of fire, flood, or natural disaster. However, if you’re found to be responsible for the damage you could be held accountable and made to pay.
Personal liability insurance could be an option for you as well as some form of contents insurance. These days a lot of insurance companies have options for renters which cover both of these concerns.
If you have a teenager about to go flatting, an insurance policy could be a welcome leaving home gift!
If you don’t drive a car then this is one you can do without! But for the rest of us who drive regularly having some form of car insurance is just a no brainer.
When it comes to car insurance, you’re going to want to make sure that you’re at least covered for damage you cause to another person’s car. That way if you swerve into someone’s brand new Porsche 911 Turbo, you won’t personally be asked to foot the bill!
If your car is new, fancy, or you rely on it daily to transport young children around, you’ll also want to make sure you have a policy that covers your car in an accident. Other extras include protection against fire, theft and natural disaster, though these may come at a higher cost.
Family insurance – Getting cheaper
As you can see, when broken down to the bare minimum insuring your family doesn’t seem quite as daunting.
A lot of the time it pays to stream line. Mortgage repayment insurance may seem like a great idea, but when you really consider why you need it you could realise that your Life Insurance and Health Insurance are likely to cover you against most of your concerns.
Where life insurance can be used to cover your mortgage if you pass away, health insurance is your best bet at ensuring you get well quick and get back to work.
The best thing about opting for life insurance at a young age, when you’re likely to have young children, is that the policy premiums tend to be a lot lower. This is because the younger you are, the less likely you are to have pre-existing conditions which tend to bump up the cost of cover.
In a lot of cases, insurance companies offer a discounted rate when you purchase a bundle of policies through them. It could pay to make sure the whole family – even teenage children – are covered on your policy.
This way, not only are they likely to get a better deal, you can also rest easy knowing that your loved ones are covered too.
Getting insurance advice from someone you trust
Once you’ve decided what kind of insurance is right for you and your family, it’s time to decide who you’ll chose to cover you.
When it comes to selecting your insurance company it pays to opt for one that shares your values and caters to the needs of your family. It might pay to ask around and see which company your friends and family are insured through as when it comes to insurance, word of mouth is usually your best bet.
Check out more great advice on protecting your family with insurance.