What Insurance Do You Really Need?

What insurance do you really need blog header?

Written by Money Empire

February 21, 2022

What insurance do you really need? Insurance is an oversaturated market here in New Zealand, especially because, for the most part, you pay for something you never actually end up using. Begrudgingly, you see the money go out of your account. But, it’s when something happens and you are just stoked to not have to worry about the finance behind it.

We’ve already spoken all about personal insurance (which we find a struggle to discuss because how do you quantify the value of life), but what about your things? When do you need it? What does the insurance actually entail?

To butter you up, here’s a few fast facts about insurance:

  • Jackie Chan needs to pay for his own insurance, and his stunt doubles insurance, as there are too many daredevil stunts and no company will back them.
  • Insurance has been around for a millennia, dating back as early as Ancient Babylon for events such as house fires or funeral cover. 
  • Millennials on average overestimate the cost of life insurance by 213%. 
  • Underwriting is basically updating a company’s T&Cs on a policy that you have purchased – essentially meaning you are covered for what you need to be and not paying for anything more.

What is contents insurance?

Contents is just another word for things. Essentially, do you have insurance for your things? It covers your things (and the cost) against loss, theft, or damage to your personal home and possessions. Contents insurance can even cover you outside of the home, such as a holiday (depending on policies). 

Why do you need contents insurance?

Contents Insurance is best suited for people who have a heap of assets that can’t really be purchased in a hurry – such as a mountain bike, nice clothes, expensive photography gear, or even a really nice laptop. To be honest, we think it’s important to get things covered if something terrible happens. 

Imagine you’re out with your friends and your candle on top of the dresser sets fire to your clothes. How much would the damage cost for that? How about the cost of the clothes?!  

What is car insurance?

Did you know that in the UK you can’t buy a car without third party car insurance? There are different layers to car insurance but essentially it means that if an accident or unforeseen event happens to your car (such as theft) you are covered. 

Why do you need it?

Some Kiwi’s think that car insurance isn’t necessary because they’re good drivers… Which is fine, except it’s not just you on the road. Insurance will help cover you if anything happens to your car that’s outside of your control, such as theft (very necessary to have a car), or damages (if someone crashes into you). Even if you are a good driver, sometimes you’re not always on your A-game and you don’t pay complete attention, which can result in a bit of a prang to another person’s car. Imagine trying to pay back damage to an expensive car out of your own pocket!

What is house insurance?

For a lot of people, a house is their most valuable physical asset. This will help to protect your asset against sudden, unforeseen, or accidental damage to it, and you can protect it specifically against certain events like fire, theft, flood, a storm, or even an earthquake. Ultimately you want to make sure if you need to rebuild your house, you have enough cover to completely rebuild it and buy new furniture, curtains, and appliances through their contents insurance.

Banks also don’t let you settle on a property without house insurance – sounds like a pretty huge necessity!

What is landlord’s insurance?

This is like house insurance – but catered to landlord’s. It can help you cover the cost to rebuild or fix the rental property you own due to damage from tenants. It can also cover loss of rent or if your tenants do a runner after causing damage. 

What is the purpose of insurance?

In order to keep building your foundation of wealth, having insurance is like the protective pillar you never want to use. Imagine buying a house and having it be ruined by a fire – not many people could pay back a house using money from their savings right? Or even if your clothes get stolen, not many of us have the spare funds sitting ready for us to splurge on an entirely new wardrobe (including underwear and socks, yep)!

Believe it or not, insurance isn’t actually there to swindle you out of money. The worst idea is when you are struggling to make ends meet and you cut out insurance, which can be way more costly should something happen down the line. 

There are heaps of different types of insurance – which is why talking to an insurance adviser is the best first step to ensure you are properly underwritten and protected. Drop a line to one of our fantastic team and let’s get the ball rolling.

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