Some need to know, with a bit of WealthDesign nice to know thrown in.

We don’t know what we don’t know

Unconscious incompetence – yes, it has a name! We just don’t know what we don’t know and it can be dangerous, especially when it comes to insurance.

For example; people who buy their air flights on their credit cards and expect everything to be covered on their free credit card cover. In a lot of cases this may be okay, but not in all cases. If you are over 75, your cancellation cover is limited to $5,000. A bit of a problem if you have booked a 17 day tour and it cost $14,000, or worse still if it’s a world cruise, with the cost being around $80,000.

A couple of years ago I was stuck in the United States for a few extra days due to a major storm. Missing connections is almost the norm when you travel these days.  I had Comprehensive Travel cover, with a $15,000 limit. If I’d relied on the free cover on my credit card, the limit is around $2,000 – which would’ve left a short fall, and left me a stressed out traveller!

This applies to life insurance policies too. At first glance, they all look the same, but once you lift the hood, you find there is quite a difference between companies and covers. You don’t want to be the person who has paid the cost of the cover for years, only to find out when you need it most, that you have the one policy that doesn’t cover your situation (unfortunately we see this often).

My advice is always – get advice! Insurance is for disasters, and you want the peace of mind that you have the right cover at the right time.

Do you want to move from unconscious incompetence to conscious competence? At WealthDesign we make the complicated simple, so give us a call and see how.

 

John Barber
WealthDesign – a life well planned

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AMP sells life insurance business

AMP has agreed to sell their life insurance business for $3.3 billion to Resolution Life.

Resolution Life is an investment company that specialises in buying “legacy life insurance” books. The company has 27 life insurance companies that they manage in the UK, US and Europe.

Obviously, they want a return on their $3.3 billion investment, and I don’t believe that AMP policy owners will benefit from this deal in the long term.

Historically, AMP policy owners shared in the profits of AMP, by way of bonuses on whole of life policies. Since listing, the bonuses have continued to be eroded by a number of changes. Many of the changes are hidden from view.

If you have an old AMP policy, I suggest you get advice from an experienced adviser who understands AMP policies, and who isn’t conflicted (as an AMP agent is). And that someone could well be me. I’ve been in this industry for thirty years and have a comprehensive policy knowledge of all AMP policies.

Give me a call, and I would be happy to give you the impartial advice that you need.

 

John Barber
WealthDesign – a life well planned

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Where the rubber meets the road

What a week! It’s been ‘claim time’ at WealthDesign this week it seems. We’ve been helping our clients out, at the most important end of the insurance puzzle – when they most need it.

As much as I would prefer my clients weren’t having to claim on their insurance, because they were healthy and happy, I feel privileged to be able to help them in their hour of need. It reinforces why I’m a firm believer in insurance, and why we always work backwards, from a claim stance. We want to know that if one of our clients needs to claim, we can hand-on-heart know that they will be looked after, both by us, and by the insurance company.

This is why we are very careful around the process of putting cover in place, and with who we trust to look after our clients. In the past few weeks, two of the larger insurers have been bought out by third parties. What impact this has on their claim handling process is still to be seen. When people say “oh it’s business as usual” I don’t quite believe them as all culture flows from the top down. If you change the focus from partnerships between the client and the insurer and if the company starts to look more at profits than providing quality outcomes – things can get slippery. Often people don’t believe insurance companies work to pay out claims, but we know some of them do. The companies we work with have a clear client focus and pride themselves in paying claims – so don’t be put off!

This week at WealthDesign we’ve been working with a guy on an income protection case (he received his first cheque this week), a lady with a crippling lung disease (hopefully this will be sorted early next week) and a guy with a heart problem. That’s not to mention two or three hospitalisation cases ranging from a specialist test to a hip replacement.

Today there are over 60,000 people on waiting list for operations alone. The stress and heart ache this causes is unimaginable. I know why I carry medical insurance personally – I see the impact of people not having it, every second day.

I see cases where people put off buying insurance or just don’t get around to the paper work,  and the result can be financially disastrous, causing much stress to the client and their family.

So after a week like this has been, I wonder why buying insurance is such a grudge purchase – why do people put off this very important part of their financial lives? But then they’re not in my shoes, dealing with the fall out of not being insured. Perhaps they should be, just for a while, to see what can happen when you’re not covered.

Give me a call, email me, whatever it takes to make sure that you and your family are covered. Expect the best, but have a plan in place for the worst – just in case.

John Barber
WealthDesign – a life well planned

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Considering signing up to Airbnb?

The Airbnb ethos resonates with New Zealanders – real people, real experiences – it’s just how we roll. I stay often at Airbnb places and think it’s an awesome addition to the accommodation industry.

More and more people are signing up to Airbnb, seeing it as a way to share their little corner of paradise, whilst earning a bit of spare cash.

There are some important things to know though, if you would like to become part of the Airbnb world.

  1. The revenue is income and subject to tax. Don’t think you can do a ‘cashie’ or you could run foul of the IRD. Consider running your Airbnb like a little side business. Keep records and claim whatever expenses you are legally allowed to claim. This way, you only pay tax on the profits.
  2. Make sure your insurance company knows you are listed on Airbnb. The last thing you would want is someone burning your house down and the insurer walking away on this technicality. Most insurers don’t cover intentional damage, however theft is covered. Ask your insurer about their policy around illegal drugs. You don’t want to become ‘cook-a-batch’ (as opposed to book-a-batch!), and find you’re up for expensive clean up costs, due to contamination.
  3. Check out the automatic insurance covers offered by Airbnb, as it may pay to carry these additional covers.
  4. Be careful who you invite into your home. This way you can mitigate many of the risks. I believe people are generally reliable and caring when they use Airbnb, but not all people, unfortunately!

Enjoy the Airbnb experience, yet be prudent about how you do it!

 

John Barber
WealthDesign – a life well planned

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