FAQ

Frequently Asked Questions

As a business owner, do I need Key Person Cover?

If there is a specific person (e.g. yourself or a key staff member) whose involvement is key to the income generation of your business then the answer is yes. If through death, accident or illness, this person is unable to work in your business to produce its normal income, the business will likely fail or need to be sold at a greatly reduced value. We can advise on the types of cover you need and determine where to set the benefit levels of Key Person Cover to allow the business to survive financially, maintaining profitability, until either the key person can return to work, or until the business can be arranged for an orderly sale.

What is Shareholder Protection Insurance?

This is cover designed to protect all of the shareholders in a business when a shareholder either becomes totally and permanently disabled or dies. Along with a binding Buy/Sell Agreement this cover provides the necessary funds to exit that shareholder and their estate, providing an accepted value for their shares and allowing the remaining shareholders certainty of the ownership of these shares. Without these funds and a binding Buy/Sell Agreement the ownership of the business is certainly not guaranteed and the shares can fall into the wrong hands. In our experience this type of cover has often been set up incorrectly, sometimes with devastating impact. Ownership of these policies is crucial and the benefit levels need to be reviewed regularly. If you would like to discuss your situation and/or have us review any existing cover to check it is correct, please contact us.

What is Life Insurance? Why do I need it?

Life Insurance is a lump sum payment on the death of the insured person. This is often used to repay debt and/or provide financially for your spouse/partner and children. We can advise and implement the correct levels of cover to look after your family in the event of your death.

How much does Life Insurance cost?

There are four main factors that influence the cost of Life Insurance, these are; the amount of cover, your age, whether you are male/female and whether you smoke. The premiums can also be affected by your current state of health but each individual’s specific situation is best discussed with us for guidance as to its impact on premiums.

Are there types of Cover that will protect me if suffer a serious illness or become disabled?

Simply put, yes there are. There are both Trauma and Total and Permanent Disability insurance products that provide lump sum benefits on diagnosis. Additionally you can consider Income Protection insurance which can provide an ongoing monthly benefit if the person who is covered is unable to work. These insurance products cover different situations and need to be personalised to you. You may have one of these policies that needs review or you may be considering getting new cover in this area. Whatever your situation it is best to have us personally advise you and gain an understanding of your specific needs to ensure the cover has the best fit to your requirements.

What is Income Protection?

This is a monthly benefit paid if you are unable to work in your current occupation. Generally your income is your biggest asset and therefore should be protected. This cover has a variable `Wait Period’ (how long before it pays a benefit) and variable `Benefit Period’ (how long it pays you if you remain off work). A longer wait period and longer benefit period are often chosen by our clients; this protects the asset that is their long term earning potential while keeping the cost of cover affordable. We can provide specific advice on the best structure of Income Protection for your needs, along with recommending the use of either ‘Agreed Value’ or ‘Indemnity Cover’.

How can I reduce the cost of Health Insurance but still have adequate cover?

A great way to reduce health insurance premiums is to add an excess to the policy. This means you pay the excess i.e. the first $250, $500, $1000 etc of a claim. By agreeing to do this the monthly premium reduces. Please contact us if you wish to look at this as an option; different Health Insurance Products apply these excesses in different ways and it is important to understand how they work prior to making any changes to your cover.

I am self employed; can I reduce my ACC levies?

If you are self employed or a share-holder employee you can potentially reduce your ACC levies. This involves electing to use an alternative ACC product called ACC Cover Plus Extra. Please contact us to discuss this as we have been able to substantially reduce some of our clients ACC expense.