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Waiver Of Premium And New Zealand Life Insurance Policies
Life insurance policies tend to be very similar across the New Zealand life insurance market
. The basis of the policy is to pay a lump sum if the insured person dies (and most plans will also pay the lump sum if the insured person is terminally ill which to a life insurer typically means that their medical specialist believes that they have 12 months or fewer to live).Life insurance policies will often incorporate a range of built in features. A common example is a special event increase option. In brief, this will enable you to increase your life insurance cover without needing to provide further heath information if you experience one of the special events (which typically are things like having a child or taking out or increasing a mortgage) covered by the New Zealand life insurance policies. Another very common built-in benefit is an advance funeral payment. Usually your New Zealand life insurance lump sum will be paid once the insurers claims criteria have been met. This would typically mean needing to provide a death certificate, as well as the insurers usual claim form. Getting a death certificate can sometimes take some time so to help with immediate costs (for example paying for a funeral), life insurers will often offer an immediate payment (typically of around $10,000).
As well as these types of built in benefits, most New Zealand life insurance companies will offer a range of other options that you can consider adding to your New Zealand life insurance. On that is commonly available is called waiver of premium we will take a quick look at how this optional insurance add-on works.
Waiver of premium is quite straight-forward. If waiver of premium is added to your life insurance NZ it means that in the event that you are ill or injured and cant work, the insurance company will pay your life insurance NZ premiums for you. This means that at the time you are unable to work, you dont need to pay your life insurance policies NZ premiums, removing the burden of these. This can be very useful if a person is unable to work, paying for ongoing costs can be very difficult, so having one of these removed can be a major relief. This is especially the case if your New Zealand life insurance premium is relatively high.
Waiver of premium on New Zealand life insurance policies can be particularly important if the illness or injury that is keeping you off work is significant. Obviously in the case of major illness, maintaining your life insurance NZ is particularly important, but can be very difficult if you are not earning an income.
With waiver of premium you will have a couple of choices to make. One of these is the waiver of premiums payment period. This is the length of time that the New Zealand life insurance company will continue to pay your premiums for in the event that you are not able to work. Life insurers will typically offer several options, ranging from two years all the way to age 65 or 70 (this is typically the maximum period possible). You can select the period you would like, and the longer the period the higher the cost. Despite the higher cost, a longer period is typically a good choice as this will offer you the greatest long term protection.
The second choice is the waiver of premiums waiting period. This is the amount of time that you need to be unable to work for before your premiums begin to be waived. Options typically range from as little as 4 weeks, through to months, or even years in some cases. The shorter the waiting period, the higher the cost of the waiver of premium.
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