Early data from the FSC’s 2023 Financial Resilience Index, which does not include general insurance, shows attitudes to risk are changing across New Zealand with an increase in the number of people taking out insurance.
The FSC says levels of insurance are up from last year and that recent weather events have prompted many people to think more about their financial situations.
Just over three quarters (76%) of respondents to the survey say they have been prompted to think about how they protect themselves and their families.
Although 32% of those respondents stopped there, others have been taking real steps to either start a conversation or relook at their finances, with 16% stating they are actively reviewing their financial situation, and 29% have spoken about their financial situation with their family.
FSC CEO Richard Klipin, says: “Pandemics, cost of living crises and cyclones are – sometimes quite literally – the rainy days that prompts us to think about how we protect ourselves when things go wrong.
“The upside is that more of us are thinking and having conversations about how we manage risk, which is vital in this time of economic uncertainty.”
The FSC says rethinking risk has translated into increasing reported levels of insurance since 2022:
- 39% report having life insurance (up 1%)
- 37% report having health insurance (up 5%)
- 22% report having trauma and critical illness (up 4%)
- 20% report having income protection insurance (up 9%)
- 17% report having total and permanent disability (up 3%)
Klipin says: “These rises are likely a reflection of the instability of the past few years, with the world experiencing several ‘black swan’ events in the form of Covid-19 and a global economic slowdown creating tough times for many people and businesses.
“If there’s a silver lining to the past few years, it’s that these events are starting more conversations in households and encouraging New Zealanders to take steps to manage their financial wellbeing.”
Klipin says life and health insurance sector pay outs remained high across 2022, and that life insurers paid out $1.06 billion in claims, while health insurers paid out $1.41 billion in claims.
“While the Financial Resilience Index’s early finds are encouraging, we still have a long way to go,” says Klipin. “Our work as an industry doesn’t stop until we’ve significantly lifted the financial confidence and wellbeing of all New Zealanders.”