Kiwis Below The Required Level of Income Protection Insurance

There is a growing concern regarding the levels at which New Zealanders are under insured when it comes to income protection insurance New Zealand. The total level of under-insurance pertaining to income protection insurance stands at $44.49bn for average 15-month serious illness duration.

Kiwis and their families are at serious financial risk of being unable to meet living expenses if the income earner suffers serious illness or injuries that would lead to the inability to continue working. A report by Dr. Michael Naylor of Massey’s School of Economics and Finance indicates that families are largely vulnerable in the medium and long terms in case of disability.

Suffering the burden of under-insurance will cause families to cater for medical and living expenses if income earners are affected by serious illnesses. Almost half of all the families in New Zealand would be affected even though most families have at least two income earners.

More than one third of respondents surveyed found income protection insurance New Zealand policies unaffordable. Less than a quarter had income protection insurance. Approximately two thirds of the younger generation found understanding of the type or level of insurance they needed too difficult.