WealthDesign

The Fire Service Commission was recently challenged by Vero and the Insurance Brokers Association over the methods for calculating Fire Service Levies, which they claim were outdated and unfair.  The insurance industry had devised schemes for minimising the levies, which were previously found by the High Court and the Court of Appeal to be legal.  So the Fire Service Commission appealed again to the Supreme Court.  The Supreme Court overturned those decisions, and the result will be more money flowing from insurance policy holders to the Fire Service.

The court has acknowledged the ‘free rider’ problem, without doing anything to help.  “Failure to insure against fire did not change the availability of the fire service in the event that the property caught fire,” the Court said.  In other words, not having insurance, and therefore not paying the fire service, doesn’t mean they won’t turn up to put it out.

It obviously has to be this way, as personal safety is non-negotiable.  We are lucky in New Zealand to have a well-trained and highly capable fire service.  They do a fantastic job, despite having limited resources.  Personally, I have long thought Fire Service Levies should be paid by every property owner, perhaps as part of local body rates – but that’s for another discussion.

While those who choose not to insure property avoid paying their fair share of Fire Service Levies, they also miss out on all the benefits of having their property insured.  Part of our work is to help our clients ensure they have appropriate and effective insurance for their assets.  Our clients choose WealthDesign as their preferred insurance broker, because we work with them to select only the cover that is really needed, and with wise use of excess options, we help make sure premiums are affordable. 

For a competitive general insurance quote along with sensible, local, personalised advice, call us.

Regan Thomas

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Currently the average length of time from a first referral with a doctor, to surgery is:

Private   52 days
Public   151 days

The public health system is good with acute services (like heart attacks), complex children’s services, long term chronic conditions and intensive specialist services.  However it’s not so good with elective surgery, and it has limited treatment options, which are not always provided by specialists.  It’s also called public health for a reason – patients have to deal with a lack of privacy.

Statistics show that treatments are becoming more complex.  Cardiac treatment for example, is moving to less invasive treatments, but with this comes more technology – and a bigger price tag. 

The only way to guarantee one has an option, is to pay for private health insurance. 

John Barber

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In the year to March 2015 health insurance claims payments across the industry topped $1,000,000,000 for the first time.  The annual dollar value of claims has effectively doubled over the last decade.

Sure, the person with insurance gets a nicer room to stay in, and avoids treatment delays.  But every time someone claims on a policy, they take themselves off a waiting list, which means someone else who hasn’t paid for health insurance gets the bed.

Government superannuation is already costing about $12,000,000,000 a year and growing – it was ‘only’ $8,000,000,000 in 2010.  Health spending is about $15,000,000,000, and also growing. 

Tax breaks for health premiums have been and will continue to be on the agenda for some time.  29% of New Zealanders have health insurance, and what is clear is they, and their claims, are making a significant and increasing contribution to overall funding of healthcare in New Zealand.

Our population is ageing, and superannuation and healthcare are going to become two major topics of debate over the coming decade (watch this space prior to the next election).  Without the significant net migration over recent years, our workforce (people who pay tax) would already be shrinking, as the baby boomers retire.

Full details have just been published here:

http://www.healthfunds.org.nz/pdf/March%202015%20stats.pdf

Regan Thomas

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The tax rules are reasonably clear but many New Zealanders still pay more than they need to and miss out on thousands of dollars in refunds.

Here are some simple tips:

1. Make sure you claim for any donations, especially school donations.
2. If you have income replacement insurance, make sure you claim the premiums, as there is a deduction for these as well.
3. If you are paying for financial planning advice, you can claim for this.
4. Make sure you have the right tax rate on your KiwiSaver. If you haven’t and you are paying too much, the IRD will not refund you, but if you’re not paying enough, they will charge you.
5. Make sure you are paying at least $1043 every year into KiwiSaver. This means you are getting a $521 tax credit. If you are not in KiwiSaver, on contribution holiday or paying below this level, you are missing out on a tax refund.
6. Check the ‘working for families’ entitlement. This is a great scheme but it can have a bite to it, if your income goes up. Make sure you get it if you are entitled, but don’t collect it if you aren’t. The IRD will come looking for you.

We’re financial advisers, not accountants, but we can help get the information you need to make sure you are claiming what is rightfully yours. For specialist advice we suggest you talk to a qualified accountant.

John Barber

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We all understand the concept of fixing our mortgages but fixing the cost of insurance seems a strange concept.

Today most people buy stepped or yearly renewable life insurance. It is a very cost effective way of buying life insurance, but unfortunately there is a loop-hole. The cost increases dramatically over time and research shows that people cancel the cover when they need it most.

The answer is to fix some of the cover. This option involves buying a ‘level to age 80’ policy. This way you know that in later years, the insurance cover will still be affordable.

Talk to us today – let’s look at your options.

John Barber

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