It’s at claim time that you really find out whether your insurance policy works the way you wanted it to and whether you’ve had the best advice. In my fifteen years as a Life Insurance Adviser I have helped many clients through claims and I’ve been sharing a few cases which have learnings that may help others. Obviously I have changed any identifying details as privacy is paramount.

Carl & Marian

Carl and Marian’s story is a difficult one for me to re-tell. I tell it knowing that insurance can’t make up for the sickness and death of a loved one – but to show that it can give you options and protect you financially from falling into an even harder situation.

I have known Carl and Marian for many years; they were early clients when I started in the insurance industry. They had three children that I saw grow up over the years until they were all adults living away from home. Carl and Marian were both working full time, living in their own home with a bank mortgage that they were chipping away at.  A fairly typical Kiwi family, getting on with the next stage of their lives.

They each had Life Cover that would repay the mortgage and provide a small cash lump sum in the event of one of them dying, and Trauma Cover that would provide a quick pay-out if either one was diagnosed with a critical illness. 

We continued to review their insurances annually and as their debt reduced, they told me that now the kids had left home they could quite happily survive on only one income if one of them could no longer work. So we cancelled their Income Protection Policies which reduced their monthly insurance expenses.

In 2016 I was sorry to get a phone from Carl to say that Marian had suffered a seizure. He had taken her to hospital where she was diagnosed with a brain tumour and she was booked for surgery within the next 4-6 weeks (they had chosen not to take Health Insurance so it was being done in the public system).

I initiated Marian’s Trauma Cover to be paid out. It immediately provided money to cover some living expenses and allowed Carl to have some time away from work to be with Marian. 

Unfortunately Marian passed away around 18 months after her diagnosis. 

Marian’s Life Claim was paid and Carl repaid the mortgage on their home which left him debt free; the outcome they had both wanted in the event of either of their deaths.

However the stress of Marian’s tragic diagnosis, of being her helpmate through her suffering and the impact of her passing away, had seriously affected Carl’s health.  Within a month of her death he suffered a significant heart attack, which his doctors’ believed was partially stress related. 

This time it was Carl’s Trauma Cover we claimed, once again providing an immediate lump sum that allowed him to focus on his own health, after an incredibly tough 19 months. This allowed him time to heal without having to immediately return to work.

While this is a sad story, both Carl and Marian each expressed to me during Marian’s treatment that their Trauma and Life Cover had taken a few worries off their shoulders. The situation they would have been without it would have been unendurable. They would have had to cover mortgage payments and expenses incurred through illness while taking time off work.

Carl and his family endured a very difficult time, but they have now moved forward in better health and spirits into a financially stable future that Marian wanted for them.

I would urge you all to review your situation with an insurance adviser. You might consider that in this case Trauma cover was essential as well as having Life Cover.

If you have an adviser but haven’t seen them for over 12 months, I’d urge you to make a review meeting with them. Or, if you need an advisor you can trust, that will review your cover annually and make sure it is done right, then feel free to give me a call.

Thanks to everyone who has read my articles over the past year. I hope you’ve gained some insight into the personal and business risks to which you might be exposed, along with how you might mitigate these by having an effective insurance plan and reviewing it regularly.