Monday, February 24, 2014

Investment News Roundup 25th February

1. Small Superannuation accounts slipping through the cracks of Trans Tasman transfers - Good Returns

Read our original article detailing the new Transtasman portability of superannuation.

2. Improving Fund Disclosure For Investors - Good Returns

3. Big changes in the pipeline for Telecom - The Headliner

4. Kiwisaver - How Good Is It For Children?

Sunday, February 23, 2014

Insurance News Roundup 24th February.

1. Reserve Bank Gets Tough on Insurers - NZ Herald

2. New cheaper health insurance plans increase competition in the marketplace. - NZ Herald

3. New NIB ambassador Benji Marshall proves a hit with the young. - Good Returns

4. Asteron welcomes new CEO David Carter. - Good Returns

5. Life Insurers move to target younger consumers in the wake of NIB and Southern Cross success. - Good Returns

6. IAG's New Zealand branch posts 75.5% profit. -

Thursday, February 13, 2014

Insurance Mythbusters: "My sum assured need only cover my debt".

It's that time again! Time to bust (or confirm) some more myths!

When it comes time to set the sum assured (definition here) for their insurance policy, be it life cover, trauma or Total Permanent Disablement, people without advice tend to assume that as long as the sum assured covers their debt (mortgage, credit cards, car payments, medical expenses etc.) then that's enough.

For instance, someone with $200,000 left to pay on their mortgage and $20,000 left to pay on their car may decide that they only need to be insured for $220,000. After all, being insured for more means higher monthly premiums and why take on the extra cost for something that isn't necessary?

Except in most cases, it is necessary.

Make sure your insurance sum assured is calculated properly, with the aid of a qualified adviser or broker., not with the aid of an abacus!

A $220,000 debt most of the time will not be covered by a $220,000 payment, as there are other factors and expenses to consider. Legal fees, interest costs, the cost of a financial adviser, bank fees and taxes and more all may need to be taken into account. So to make sure you don't leave any debt behind to your beneficiaries, it is generally necessary for your sum assured to cover the sum total of your debt and then some. How much will depend on your unique circumstances, but if you're in doubt, ask a professional.

VERDICT: This one is definitely busted. Just calculating your sum assured to erase debt may leave more costs on yourself or your beneficiaries during stressful times when they can't afford it. Make sure that all potential costs are considered, taken into account, and if at all possible, leave yourself with room to play by expanding your sum assured as much as is possible and affordable.

Monday, February 3, 2014

News Roundup

A round-up of all the insurance and investment news fit to print.

1. Tower to keep the remainder of its life insurance business after selling to Fidelity.

2. Brian Gaynor: Forget Obamacare, New Zealand has its own medical insurance issues to address.

3. Harbour Asset Management director of fixed interest, Christian Hawkesby, spells out the eight key indicators to watch over the next 12 months for fixed interest investors.

4. London-based economist Andrew Hunt casts his eyes over global markets.

5. $200 million dollar payout for quake hit schools.

6. Sovereign is liable for $82 million after losing its battle with the Inland Revenue.

7. Less than a third of young people have the insurance cover they need.