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Life Insurance - the end of an era?


There has been much discussion recently about the "soft" commissions paid by the life insurance companies to their top salespeople. The inference might just be that sales people shouldn't need to be generously rewarded with all expenses paid overseas trips, for just selling another product.

But it is just another product?

Financial commentators are saying that the lives of New Zealanders are generally under insured, and it is well known that insurance advisers are not getting any younger and their numbers are falling. And, one of our major insurers paid out over $100 million in claims to over 1,000 customers in 2017 - and that's only one of our insurers!

Without insurance advisers would those over 1,000 customers been able to be provided with the financial security they would have been so desperately grateful for?

Just how important is disclosure of health history?

Sometimes life insurance companies decline claims because they deem to have not been given the full medical history of the claimant at application time. On acceptance of a life insurance application the insurer undertakes to pay a set sum at claim time, in exchange for the payment of premiums by the customer.

In many respects the real certainty rests with the customer and the life insurer can only take an educated but well researched guess as to when the customer might become a claimant. But if the insurer knows that the applicant has a history of say high blood pressure or cholesterol (possibly unimportant to the customer!), then that educated guess becomes much more significant!

Are life insurance applications full of difficult health questions?

This is a difficult question to answer - some questions are straightforward whereas others are a little more difficult! Some people will be well aware of just what high blood pressure is and what it can lead to, but be unaware of just what sleep apnoea is and the risk to health that it might entail.

Can we help?

At Thompson McNeill we believe that providing life, income protection, trauma and health insurance is vital and every bit as important as helping our clients into homes.

While recognizing that yes, some insurance questions are difficult, we are confident in our knowledge of the health issues that can impact on the acceptance of a life insurance application. We are therefore very ready to guide our clients through the application process and "jog" memories about important medical events that need to be disclosed. We believe that advisers play a critical role at both application and claim time!

For well researched and competent advice and guidance call us on (03) 281 8605 or email jerome@thompsonmcneill.co.nz


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