The Financial Services Council (FSC) recently released their latest research report ‘Money and You – Taking Cover’. They surveyed over 2,000 New Zealanders, revealing some interesting insights into the financial confidence and wellbeing of Kiwis and their relationship with insurance.
Key findings:
- Around a third of New Zealanders have life or health insurance, but the majority are uninsured.
- The largest drivers of life and health insurance uptake are wanting peace of mind and worrying about family members.
- The main reason that two thirds of New Zealanders don’t have insurance is due to affordability.
- Households with higher incomes are nearly four times as likely to have insurances.
- Those that previously had these insurances, but no longer do, no longer see the value in it or find it too expensive.
Health comes first
The FSC survey revealed that of all the life and health solutions you put in place for your clients, health insurance is by far the most claimed on, which is a great reminder of why health comes first and further demonstrates why comprehensive health cover is incredibly valuable for your clients.
Rising costs are leaving many uninsured
Kiwis are currently dealing with a cost-of-living crisis and rising interest rates, so it’s no surprise that many are underinsured. In fact, the survey reported that almost 70% of Kiwis do not have health insurance, meaning they are relying on an overwhelmed public health system with increasing wait times.
Over half of respondents find cost a major barrier to taking out insurance, with 55% saying they would take out an insurance policy if they had more money. When explaining the survey, FSC CEO Richard Klipin also referred to the FSCs March 2022 Financial Resilience Index Report which "showed Kiwis are worrying about their finances and it’s affecting their overall wellbeing. Many haven’t lived through a recession or severe financial shock before and will be looking for support as they face these challenges for the first time.”
Plan for the unexpected
“While it’s understandable some are, and should be, prioritising immediate needs, the latest findings are cause for alarm and reflect the importance of long-term thinking when it comes to our finances." Says FSC CEO Richard Klipin.
The FSC’s 2022 Financial Resilience Index Report also revealed that if something unexpected were to happen, 40% of Kiwis would be unable to access $5,000. “We need to consider what would happen if you suddenly got sick or had an accident and were unable to earn a living. If you don't have access to emergency funds and don't have insurance, who else will be impacted and is relying on you to get by?” says Klipin.
Supporting your clients
Insights like these can help you better understand the needs of your clients and give you a great opportunity to have more healthy client conversations with them. It’s also a reminder of the importance of your role as a financial adviser, supporting your clients with the tools and resources they need to help them gain more control over their health and wellbeing.
You can sign up to read the full FSC research report here.