What is the single most important action that should be taken to address the under-insurance issue in New Zealand?
- Improve financial literacy (40%)
- Ask government to include life insurance with all Kiwisaver plans (18%)
- Make life insurance compulsory for all mortgage payers (12%)
- I have a different idea (12%)
- Develop lower-priced and more flexible life cover products (11%)
- I don't believe under-insurance is an issue (6%)
Loading ...New Zealand is ranked 27 according to the RBNZ when it comes to the penetration of life insurance across 34 OECD countries.
AIA’s Len Elikhis, the insurer’s Chief Officer Product & Vitality, says low financial literacy levels among consumers, together with their reliance on ACC, are among the underlying causes of the country’s under-insurance issue.
Kris Ballantyne, Chief Marketing Officer at Partners Life, says under-insurance isn’t due to a lack of product availability or affordability.
“It’s a combination of cultural barriers and a lack of financial literacy and education,” he says.
One suggestion Elikhis has is to roll life insurance into Kiwisaver so anyone enrolled in the voluntary retirement savings scheme will be automatically insured – providing cover for people who may not otherwise be able to obtain life insurance.
This week we’re asking what the wider adviser community would do to raise the levels of risk insurance across all New Zealand communities.
See our story Under-Insurance in New Zealand.