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Life Insurance from a Bank? Buyer Beware

life insurance

Do you have Life Insurance with the Bank? I think its time we did an insurance review.

Have you visited or called your Bank recently? Did they try to up-sell you? I bet they did, “Would you like to talk about getting insurance with us today Sir?” or “Did you want to move your KiwiSaver over to us so you can see it on your banking app?” I’m sure most of us have all had it. The ‘would you like fries with that approach’. They bombard you with questions trying their best to get a sale. Unfortunately, their staff are financially incentivised to sell these products and have strict targets to achieve.

You wouldn’t take medical advice from your hairdresser, so why would you take insurance advice from a Bank teller? Insurance and banking are not the same thing at all.

Bank insurance policies usually provide a poor level of cover for a similar price if not more than other leading insurance companies. It is also unlikely that you will receive the best advice or even the best products for your needs when buying from the Bank. In the sad event of a claim you will contact your Bank and most likely speak to someone in a call centre not the person who you originally dealt with. So the headache at claim time can be quite difficult when you want it to be easy and smooth. There is also next to no servicing other than a ‘yearly increase in premiums’ letter.

The application forms are designed for fast and convenient processing and do not always ask all relevant questions relating to medical conditions or other important disclosure. This can result in non-disclosure and a claim potentially being declined. Did you know, 99% of unpaid claims are from non-disclosure?

So as you can see, getting this right is the key. You don’t want to spend all this money for something that doesn’t work when you need it most!

I feel that in my visits to the Bank the tellers put pressure on to try and railroad clients. Don’t let this be you. Don’t feel pressured into taking out insurance with them. Its ok to say NO and shop around.  Even if your home loan is with them. This is where a independent adviser comes in. They do the market research and can review products from all major insures to  help you make a informed decision.  They will also be there to help guide you through the application, provide ongoing advice and reviews and be there to support you at claim time. Using a insurance adviser will also give you peace of mind. And how can you put a price of peace of mind.

If you have insurance with your Bank, like so many New Zealander’s do, and you are concerned you don’t have the best cover in place then please give me a call.  I will provide a FREE insurance consultation to help you get things sorted.

This article contains general information and does not take into account your individual requirements. Before making any changes to your insurance, please seek independent advice from a professional insurance adviser.

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