Conversations about death aren’t easy. Most of us would rather not think about it – but planning ahead can make all the difference for the people we love. That’s why we’re shining a spotlight on Life Insurance: a powerful tool that protects your loved ones at a time when they’ll need it most. Life Insurance in New Zealand is about more than policies and premiums. It’s about peace of mind. Putting a plan in place now can help ease the financial pressures on your family during an already difficult time.
How Life Insurance Works
Your greatest financial asset is you and your ability to earn an income. If you were to suddenly pass away, that income – that your family might rely on – disappears. That’s where Life Insurance can help, providing a financial safety net that gives your family the space and time to focus on grieving without thinking about how to make ends meet.
In New Zealand, Life Insurance typically pays out a lump sum to your family in the event of your passing. Depending on your cover, you may also be eligible for an early payout if you’re diagnosed with a terminal illness.
You can choose from varying levels of cover depending on your financial situation. Even if you have no dependents or large liabilities, some people take out a small amount of cover to help their loved ones with the expenses that arise in the event of your death.
A Life Insurance payout can be used for:
• Covering funeral expenses
• Paying off a mortgage or other debts
• Supporting day-to-day living costs
• Leaving a legacy for future generations
• However else your family sees fit
Think of it less as a piece of paperwork and more as a financial plan for your family’s future.
The Cognitive Bias of ‘It Won’t Happen to Me’
Life Insurance can sometimes feel like a dull piece of admin that’s easy to put off. But one thing we can all be sure of is that life is unpredictable – and preparing early can prevent panic later on.
Common reasons people delay include:
• “I’m still young and healthy – I don’t need it yet.”
• “It’s too expensive with the cost of living.”
• “I’ll sort it once the mortgage is smaller / kids are older.”
But waiting can come at a cost:
• Unexpected illness or accidents can make cover more expensive – or unavailable.
• A delay could leave your family unprotected when they need it most.
• Premiums rise with age.
For example, someone in their 20s might pay around $25 a month for the same level of cover that could cost over $500 a month in their 50s. By acting early, you can lock in affordable premiums and build Life Insurance into your long-term financial plan.
So don’t leave it as something to “get around to later” – prioritise your family’s future today.
Real Stories: The Cost of Waiting vs. the Value of Cover
Willie Moala, AdviceFirst National Insurance Lead, has seen both sides of the Life Insurance journey.
“A couple once came to me considering cancelling their policy. I reviewed their situation and found they were paying more than they needed. By restructuring, they kept the cover they wanted at a price they could afford. Years later, when one of them sadly passed away, the payout covered funeral costs, cleared debt, and left a legacy for their grandchildren. It made a huge difference at a devastating time.”
But not every story ends this way.
“Another family I met chose not to take out cover due to other financial pressures. Sadly, when one partner was diagnosed with a terminal illness, it was too late to get insurance. They shared their regret at not having taken out cover sooner – and, unfortunately, by the time they wanted protection it was no longer possible.”
These real-life examples are reminders that Life Insurance is about preparing for the unexpected. The earlier you act, the more options you have.
When’s the Best Time to Take Out Life Insurance?
The short answer: now.
While it may be tempting to wait until later in life, the risks of delay usually outweigh the savings. By acting while you’re younger and healthier, you:
• Lock in lower premiums
• Secure cover while you’re still eligible
• Give your family financial certainty sooner rather than later
How AdviceFirst Can Help
Life Insurance in New Zealand can feel overwhelming with so many providers, products, and policy structures. That’s where our team comes in.
We work with you to:
• Understand your financial goals
• Review your existing cover (if any)
• Build a plan tailored to your needs and budget
You don’t need to navigate it alone. With expert advice, you can feel confident you’re making the right decisions for yourself and your family.
Protect Your Tomorrow, Today
Life Insurance isn’t just about money. It’s about ensuring your loved ones can live without financial stress if the unthinkable happens.
If you’d like peace of mind that your cover is appropriate for you – or you’re exploring options for the first time – our advisers are here to guide you.
Disclaimer: This blog is for informational purposes only and does not constitute individual financial advice
