Most people arrange their health insurance, income protection, trauma cover, and life insurance once and never look at it again. But that apathy can cost you.
Personal insurance policies are arranged at a specific point in time, based on your income, debts, and circumstances at that moment. Life moves on. Your cover often doesn’t.
Income protection / Mortgage Protection are the most common areas we see fall behind. If your salary has grown since you last reviewed your policy, you have increased youre mortgage and therefore your payments, your monthly benefit may now replace only a fraction of your actual income/ payment requirements. Trauma cover and life insurance can become equally outdated, a policy structured around a $600,000 mortgage looks very different when that figure has grown to $900,000, or when there are dependants who weren’t there when you first signed up.
Medical and health insurance is another area that deserves attention at every review. The specialists you need access to, the treatments you want covered, and the level of payments you are willing (or able) to absorb all change over time. A policy with a high excess may have made sense early in your career when your health was straightforward; it may look very different now. Checking that your benefit limits, specialist cover, and day-to-day healthcare options still reflect how you actually use the health system is a practical step most people overlook.
We recommend reviewing your personal insurance every 12-24 months as a baseline. However, there are a number of key life events that should prompt a conversation sooner, including:
These are the moments when the gap between the cover you have and the cover you need is most likely to have opened up.
A review isn’t only about updating your cover. Sometimes it uncovers something clients genuinely don’t expect: a benefit they were already entitled to claim but didn’t know existed – and this is more common than you might think. For example, in the past 12-months, one of our insurance advisers uncovered six claims that clients hadn’t known they were eligible to make during the review process, which equated to more than $80,000 in settled claims.
This is often because policy wording is precise and detailed and the lists of qualifying conditions and health events typically go well beyond the headlines most people remember.
Two recent examples show how easily entitlements get missed.
Trauma Cover: A Diagnosis That Qualified For a Payout
During a review, with a prospective client in her 50s, our adviser discovered that she had been diagnosed with Severe Ulcerative Colitis some time earlier. She had been managing the condition and had moved on, but it had never occurred to her that it might be covered under her insurance. When we reviewed her policy wording together, we found that Severe Ulcerative Colitis was listed as a qualifying event under her Trauma Cover benefit. We helped her lodge the claim and she received a lump sum payment of $36,000. It was money she had been fully entitled to under a policy she had been paying into for years, she simply hadn’t known the benefit applied.
Specific Injury Cover: An Accident He Didn’t Realise He Could Claim For
In another instance, a client in his early 30s came in for his annual review. A keen cyclist, he mentioned in passing that he had fallen off his road bike the previous year and had fractured his collarbone. He’d claimed under ACC at the time for rehabilitation support and had since recovered and moved on. It hadn’t crossed his mind that his insurance policy might also cover his injury.
However, as we were reviewing his policy we identified that his mortgage protection policy included Specific Injury Cover, a benefit designed for exactly this kind of incident. He had no idea the cover applied to him until the review prompted us to look. We helped him lodge the claim and he received a lump sum payment of $8,200, which was two-times the amount of the monthly mortgage payment he was insured for under his policy, and a significant payout from cover he didn’t know he had.
A professional insurance review looks at three things: whether your existing cover still reflects your current income, debts, and family situation; whether the structure of your policies remains appropriate compared with what’s available in the market today; and whether any benefits within your existing policies may apply to events that have already occurred.
For most clients, a review provides reassurance that everything is in order. For others, it surfaces meaningful gaps or, as the examples above show, claims that were already there to be made.
As the case studies above highlight, it’s not enough to simply have insurance. You need to understand what it covers, and have someone in your corner who can connect the dots when life happens.
A review with a Threefold adviser takes around an hour and there is no cost. We’ll look at your existing policies, explain exactly how your cover works, and check whether it still fits your current circumstances, including whether any benefits may apply that you haven’t previously considered.
To book a chat with your Threefold insurance adviser, contact them directly or fill in the form here.
As a general rule, you should review your personal insurance every 12 months. That said, certain life events should prompt a review sooner: a salary increase, a new or larger mortgage, starting a family, going into business, or receiving a new health diagnosis. Insurance arranged even two or three years ago may no longer reflect your current income, debts, or family situation.
Trauma Insurance pays a one-off lump sum if you are diagnosed with a serious medical condition covered by the policy (such as cancer, heart attack, or stroke) or some severe injuries.
Trauma cover (also called critical illness cover) pays a lump sum if you are diagnosed with a condition listed in your policy. Most people associate it with cancer or heart attacks, but many policies include a broader range of qualifying conditions, including serious gastrointestinal conditions, neurological events, and major organ disorders. If your claim is accepted, your payment can be used however you choose, for example to support recovery, cover medical costs, reduce work hours, or pay down debt.
If you have received any significant health diagnosis and hold trauma cover, it is worth having an adviser review your policy wording. You may be entitled to a claim you have not made.
Specified or Specific Injury Cover pays a fixed lump sum if you suffer certain defined injuries, such as fractures, burns, or permanent loss of sight or hearing. The amount paid depends on the type and severity of the injury and is designed to help with immediate expenses during recovery.
This cover might be included as part of your mortgage protection policy or some insurance providers also include it as a stand-alone option. Unlike income protection, a claim does not depend on your ability to work. The injury simply needs to meet the definition in your policy. Common qualifying injuries include specified broken bones such as a fractured collarbone, wrist, or leg. Claim windows for specific injury cover are generally generous, but the entitlement is easy to miss if you are not aware the benefit exists.
Yes, and it is often the cover people pay least attention to between reviews. Your health insurance needs change as your life does. The specialists you require access to, the treatments you want covered, the excess you are comfortable carrying, and the benefit limits that made sense when you first took out the policy may all look different now.
Depending on your policy and the cover selected, it can help fund everything from doctors’ visits and prescriptions, through to specialist consultations, major diagnostic tests, surgery, access to Pharmac and non-Pharmac (but MedSafe approved) drugs, and hospital care. A review gives you the chance to check that your health cover still reflects how you actually use the health system, and whether better options exist in the market.
In many cases, yes. Insurance policies often have generous claim windows and simply require that your policy was in place at the time the incident or diagnosis occurred and is not a pre-excluded ailment. If something has happened in the past that you did not connect to your insurance at the time, a review is the right moment to check whether a claim may still apply. It is one of the most common and valuable things a review uncovers.
The content of this article should not be taken as financial advice, or a recommendation of any financial product. These insights are based on current economic commentary, market pricing for interest rates, and our personal opinion. Threefold is not liable or responsible for any information, omissions, or errors present.