DO I NEED A BROKER FOR GENERAL INSURANCE?

What does an Insurance broker do?

Insurance brokers work with their clients to understand their risks, and to discuss how to use insurance to protect their assets and businesses. Brokers offer expert advice on the management and transfer of risk, including the range of insurance products that are available.

We use our in-depth knowledge of risk and the insurance market to identify and arrange suitable insurance cover – both for businesses and individuals.

As brokers, we have an extensive knowledge of the range of insurance policies available in the market as well as a network of industry contacts, allowing us to negotiate the best deals for our client’s individual needs. The same skills and networks are also used to help our clients resolve claims when they arise.

Why should I use a broker?

An insurance broker can save you time, money and worry. A broker can help you understand the cover you need, and can purchase that cover for you from the insurance market.

Some insurance policies can be complicated; we can help you understand important details in those policies so you can make better informed buying decisions. We understand your current situation, then work out what level of cover you need, before making sure you are properly protected.

Often consumers and businesses will make a decision based purely on the lowest price – that can backfire in the event of a claim if you find out you’re not adequately covered or, even not covered at all, for your loss that has occurred.

Whether it’s Home, Contents, Vehicle or Marine insurance, our brokers provide advice and assistance to make sure you are properly protected. The advice is tailored to YOUR needs.

 

Do I have to pay to use a broker?

As professional insurance brokers we are no different to any other professions like lawyers, accounts, etc and earn our income for the professional services we provide. We earn this through a combination of commissions from the insurers and broker fees which we disclose the actual amount to you for the fees. Our brokers have the knowledge and can use our leverage to negotiate appropriate cover for you at a very competitive rate. Remember, not all insurance policies are the same. You might be able to get a cheaper policy elsewhere, but it may not provide the cover you need if something goes wrong. Whether it’s Home, Contents, Vehicle or Marine insurance, our brokers provide advice and assistance to make sure you are properly protected.

Does it cost more to use a broker?

Our brokers have the knowledge and can use our leverage to negotiate appropriate cover for you at a very competitive rate. The only time you MAY end up paying more is if you had inadequate cover in the first place prior to talking to us.

A broker is obliged to advise you of any Admin fees charged for their services provided to you, so there are no hidden costs. Remember, not all insurance policies are the same. You might be able to get a cheaper policy elsewhere, but it may not provide the cover you need if something goes wrong.

What is insurance, and how does it help me?

Insurance is a way of managing risks. When you buy insurance you transfer the cost of a potential loss to the insurance company in exchange for a fee, known as the premium. You are effectively paying this premium upfront to ensure that you are covered for your larger losses if and when they occur.

Insurance helps you:

  • Own a home or a business, because mortgage lenders need to know your home or business is protected. It covers you for repairs and replacement of any damage that’s covered by your policy. This includes protection against fire and damage from perils like natural disaster and many more.

 

  • Drive vehicles, because few people could afford the repairs and legal expenses associated with collisions without insurance coverage. If you are legally responsible for damage from your driving negligence, a vehicle policy will also cover the costs to help repair or replace damaged third party vehicles and property.

 

  • Protect Household Items, as in most instances, accidental loss or damage to household items can be expensive to fix. Whether you drop your phone, or your laptop breaks, insurance helps you get back to into the same position faster, before the loss occurred.

 

  • Protect your legal liabilities. For example……If you were to accidentally burn your landlords house down, you may be the one held responsible / liable. All contents insurance covers come with at least $1 million dollars of liability insurance so if the insurance company decides to come after you for the damages cause, your liability cover will pay for it!

Why is it important to have the right type of cover?

There is no ‘one size fits all’ solution for insurance, having an Insurance Broker to tailor an insurance plan specific to YOUR needs can be crucial. Not all cover is the same, this changes from insurance company to insurance company. Often, the lower the premiums, the lesser amount of cover you have. In most cases, people do not realize this until it is time to claim and the insurance company will not cover it!

8 Reasons you SHOULD use a Broker

  • You get a better Deal

All our advisers are independent and not tied to one bank or insurance company. This often means we can get you a better deal, which can include a discounted interest rate and cash back rewards, lower premiums and better cover. It’s our job to negotiate with the banks and insurance companies to make sure you are getting every possible advantage available.

  • We give you Good Advice

If you want some Good Advice (for free), we’ve got it. Whether you are trying to get into your first home, looking for the right type of insurance or to do some future planning around investment property or business growth– our team is here to help. This is our passion and we would love to share it with you!

  • You get MORE choice

We have many options available to you for Finance and Insurance. This means we are able to find the BEST provider specific your situation and needs. This comes in especially handy if you are trying to do something outside of the box.

  • Less Stress for You

When we say less stress, we don’t mean no stress…. the purchase of a new home, asset or insurance is a big financial decision, so there will always be an element of stress involved. BUT we will work hard to reduce the stress and workload for you.

  • We are LOYAL to You

We don’t work for Banks or Insurance Companies… We WORK for you! This means while we are looking at different providers and what they can offer, our recommendations are based upon what is BEST FOR YOU. When we say we are LOYAL to you, this is because we have 100% of your best interest at heart!

  • We will be your Wingman

We will be with you every step of the way, helping you to reach your goals. Whether it’s a warm handshake to meet some new business associates or sweet talking the banks until they give you what want.

  • Turn that NO into a YES

Sometimes your plans don’t go to plan. You may have applied for a home loan and been given an approval that was for a lesser amount or been declined. This can often be solved with an ‘outside the box’ solution which can help you achieve some of those BIG financial goals. Our main goal is to see you succeed and we will help you find a way!

  • It’s a FREE Service

Our service is generally free (9.5 times out of 10) unless it’s for something complex or tricky, and if that’s the case we will always be open and upfront with you from the beginning so there are no surprises.

Our Top Tips for buying a new Used Vehicle

On the hunt for a new Used Car this weekend? Whether you are going to a Dealership or buying Privately, these tips could help you avoid buying a LEMON.

Get Educated!

The Consumer Protection website is a great resource for someone purchasing a car. It is full of helpful hints and check lists you can utilize while going through the buying process. You can get schooled up on the Consumer Guarantees Act which will help you make a better decision. If something does go wrong after your purchase, it will guide you through the process and you will know your rights from the get go. Knowledge is power!!!

 

Buying an import from a Dealer?

The majority of used cars sold by NZ Dealerships are Japanese imports. More often than not the vehicles are of high quality and low km’s. BUT if the price is too good to be true you might want to find out why? Here are a few things that can determine pricing of imported vehicles.

KM’s and Age

This is a pretty simple concept – A vehicle with High kilometres will or should be cheaper, the older the vehicle the cheaper it should be.

Low Grade Import

All vehicles imported from Japan have an auction grade. A High Grade import will be more expensive as the overall quality and standard of the vehicle was high when it was purchased at Auction. Here is a brief overview of how a vehicle is graded at Auction

5 – brand new car

4.5 – mint second hand exterior and interior condition, low kms, late model etc

4 – very good exterior and interior condition with minor panel and paint

3.5 – good exterior and interior condition with minor panel and paint – damage to be repaired

3 or less – low grade vehicle and would have needed to have a lot of work done to bring it to a reasonable standard for sale, probably over 100kms on the clock or could have been a damaged or accident grade vehicle.

If you are seriously looking at a vehicle, ask the dealer if you can see the Auction Sheet, most of it is in Japanese but you will be able to see the auction grade in the top corner.

Has this vehicle been imported as a Damaged Vehicle?

By Law ALL vehicles must have a window card with all the pre purchase information ie, Year, KM’s and fuel star rating. The window card must also state if this was previously a damaged vehicle. Check bottom of the window card, there should be a yes or no box ticked stating this information. You will need to keep a copy of the window card after purchase along with your sale and purchase agreement.

 

Buying Privately?

Ask the right questions

  • Is there anything wrong with it?
  • Is there any money still owing on it?
  • Are there service receipts for any work that’s been done?
  • Is there a second set of keys? Getting a second key cut can be very expensive.
  • If the vehicle has a cambelt, when was it last changed? Generally, they need to be changed every 100,000km. Depending on the model, this can be very expensive.
  • When were the tyres changed? Is the tread depth is less than 3 millimetres deep or if they are showing signs of aging, eg cracks on the sides.
  • Is the vehicle insured? It’s important to know if you’ll be liable for damages if you have an accident while test driving.
  • Does the car have to be serviced by the original dealer? Many newer cars must be serviced by a dealer to maintain the warranty
  • How long have you owned the car?
  • Why are you selling the car?

 

Pre Purchase inspections and searches that can be done…

If you buy from a private seller, you can find out if:

  • the car has been registered as a stolen on New Zealand Police’s Stolen Vehicles database
  • there’s still money owing on the car by using the Personal Property Security Register’s mobile friendly search.

No matter who you buy from, you may want to consider double-checking the information the seller has given to you. There are a number of vehicle history report providers online. For most of these services, you enter the plate number or vehicle identification number (VIN) to get a comprehensive report on ownership history, previous damage, money owing, odometer readings. Some of these services are free or charge a small fee.

If your basic checks, test drive and history checks go well, the next step is to arrange for the vehicle to be inspected by a professional mechanic.

The best way to avoid a problem is to get the car inspected by a mechanic or pre-purchase vehicle inspection service.

Some car dealers will sort this for you with their preferred mechanic, though it may be beneficial to get this done yourself to get an independent report.

An inspection is even more important when you buy from a private seller. You have fewer consumer rights if there’s a fault or problem with the car after purchase.

For more information you can visit www.consumerprotection.govt.nz

HAPPY SHOPPING!!!!!

5 Things to do to make buying your first home EASY

5 Things to do to make buying your first home EASY

So you want to buy your first home? Congratulations!!! This will be one of the biggest AND most expensive decisions of your Life…. Next to marriage. Like anything new, it’s important to get some good advice, hopefully you can learn from other peoples experience and mistakes. Here are our Top 5 Tips to help make this process easier for you.

1. Make a list …. Needs vs wants

Making a list of what you want and need before stepping foot into your first open home is ESSNETIAL! You don’t want to waste precious time looking at 50 houses when you could have narrowed it down to 5 by first making your list. The list will help keep you focused on what you really want, and avoid being “sold” into a property that isn’t actually suitable.
If there is just one person involved in making the decisions, hopefully making the list will be easy. If there are two or more parties involved, the list is doubly important and could help prevent embarrassing “discussions” in front of real-estate agents and the like because you can’t agree on the size of the garage.

2. Find a Mortgage Broker

Not all banks are the same, and with ever changing lending criteria, you could be getting a better deal down the road… But who has time to shop around? This is why you should find a good Mortgage Broker to get you Pre Approved. Not only will they find you the best home loan deal, they will be able to guide you through this process. Your Mortgage Broker will be able to present you application in the best way possible to different lenders and negotiate the best terms and rates for you, this could save you THOUSANDS in the long run! Don’t know where to find one? Ask your friends, if they have used a Broker previously and had a good experience, they will have no hesitation passing on their details to you… or you can just use google.

3. Know how much you can spend!!!

Get your Pre Approval done ASAP. This will save you a lot of heart ache and prevent you from looking at and falling in love with a home that you may not be able to afford right now. Your Pre Approval will make sure you are not financially over committing and save you time in the long run. The Pre Approval will also help you refine your list, you may need to shift the swimming pool from the needs category to the wants category 😉
With your Pre Approval in hand you can work with your Brokers and Agents to ensure you are getting bang for your buck! REMEMBER, this is your first home, a stepping stone on to the property ladder, and with careful planning and goal setting it will not be your last!

4. Make that agent EARN their commission!

Enlist a real-estate agent in the search for your Home. This can help massively as they will be able to show you homes BEFORE they come to market. This gives you a first in first serve opportunity and could help avoid a multi offer situation. Selling a home is just as stressful as buying one, if the seller can avoid weeks of open homes then they will happily look at offers before going to market. Share your list and budget with your agent as well, this way they will present you with options to suit YOU. This is a FREE service agents provide to home purchasers and is a great way to find golden opportunities. Many hands make light work.

5. Have fun and enjoy the Ride

Now that you are equipped with your Pre Approval and List, and with the help of some good professionals, you can start your Home Ownership journey. Buying your first home won’t always be smooth sailing, just remember to have fun and relax. You will only be a first home buyer ONCE and you will gain a lot of knowledge along the way. Congratulations! This is going to be great!

Adult Placing Money in Childs Hand

3 Valuable Lessons to Teaching Kids the Value of Money

I’m not sure about you, but I grew up in a family that did not teach me about money. The extent of my financial education was, “Save 10% of every paycheck and make sure you pay your bills on time.” Sound familiar? It should because roughly 97% of the population had the same education.

Statistics show that less 1% of the entire world population has no debt and $1,000 or more saved in the bank that wasn’t inherited. Crazy right? Are you part of the one percent?

I believe it all began when we stopped taking stock of what we had. Think about it for a second. When the world was run on an agricultural commerce system, farmers knew how many sheep they had, how many were born healthy that year, how many were expected to be born the following year, where each of those sheep were grazing, how they were impacted by the weather patterns, their feed etc. In other words, they knew everything about their source of income.

Fast forward to our current economy. The average working adult makes purchases with money they haven’t received yet (credit cards). They don’t know the exact amount of money they made on their last paycheck, they can’t forecast their next few paychecks and they can’t name where every dollar is going to when it leaves their account which is scary.

It’s time to change that culture. You may not have had a great financial education (as I didn’t) but that doesn’t have to be the same story your children have. It’s time to start winning with money and it starts with you.

Money is a tool

Simply put, money is a means to trade one thing for another. We trade money for clothing or money for petrol. It’s a means to an end. The end is subjective to the individual but in today’s economy, the means is the same. Here’s a great example of how trade works. During hurricane Katrina in 2005 the people that were effected by those flooding waters no longer thought about money as the greatest resource. In the midst of the disaster, money had very little value. What became the highest valued commodity? Clean, fresh, drinkable, bottled water. Yep. As sewers overflowed and contaminated the water systems throughout the city, drinkable water became scarce. Nobody was thinking about grabbing their wad of cash to go buy clothes, they were looking for clean and drinkable water. The water became the most valued means of trade. Money in itself is just a tool for trade. That’s it.

Teaching point: Buy multiple types of lollies and have the kids begin to trade for the types they want the most. Point out that they are trading certain lollies for the lollies they desire.

 

Investing at a young age is KEY!

Compounding interest is a beautiful thing, after 20-25 years!!! After 20 years the gains are so massive that the average person can’t comprehend it. If a 20-year-old starts to invest, they will have compounding interest working for them for 50-60 years. If a 40-year-old starts investing, they only have 30-40 years to benefit from compounding interest. Let’s check out the difference. Suppose a 20-year-old invests $1,000 (never adding a dollar to the investment) and averages 10% interest over 60 years, they would have $304,481 when they are 80. Now the same scenario for the 40-year-old. They invest $1,000 from 40 to 80 years old. They would have $45,259. Just a bit of a difference ey? Invest young!!!

Teaching point: Using play-doh, sprinkle tiny pieces of play-doh on a table. Have them make a small ball and begin rolling it over the tiny pieces on the table. As they do this, point out that their original ball is beginning to get bigger and bigger and bigger. The longer they roll the ball, the bigger it gets. 

 

Work hard, but work smart!

There’s no doubt that hard work pays off. But there is a difference between hard work and smart work. In order to build wealth, we have to think efficiency. What is the best use of our time? It may be that your time is best used in the workspace at the moment, but in the long run, you will be limited to your own time and abilities, which are highly limited. When we get others working for us, then we are able to leverage other people’s time, talents and abilities to build wealth. The best part… it frees up time and resources to do those things that you are the best at.

Teaching point: If your child is responsible for multiple chores, have them recruit some helpers. Show them how their time doing chores shrinks drastically by leveraging the help of others. 

 

One of our passions is to educate and help families build wealth in order to change their family trees and have excess finances in their budget to really bless others. 

Here’s to a great future!

Chris

Life Insurance Document on Clipboard

Public Health Care Vs Private Medical Insurance in New Zealand

Do I need Private Medical Insurance? It’s a common question that many Kiwis think about.
There are pros and cons to both the public healthcare system and Private Medical Insurance.
Having known of a few people already this year that have serious medical problems, and are still on the public waiting list, I thought I would just highlight the differences between the Public Health Care System and Private Medical Insurance.
Another option would be to “self-insure” by putting funds aside in a savings account for unexpected medical care. The problem being some illnesses can be very, very expensive to treat.

Public Healthcare

Every taxpayer, including beneficiaries, contributes to the health system in New Zealand. Some would argue that you are already contributing towards the public health system so you should use it.

Waiting for treatment can be a reality of the public health system. Being on the waiting list can disrupt your income, and put unnecessary stress on yourself and your family, especially if you are self-employed or one of your children is sick and needing medical attention.

New Zealand has a public healthcare system that is effective in providing healthcare support for accidents, and acute or urgent care, but public hospitals can’t do everything for everyone. Thousands of Kiwi’s living in pain are unable to access healthcare due to the long waiting lists. The number of surgical, dental and mental problems being overlooked is becoming a concern.

For Urgent medical care, the public health system in New Zealand will look after you. Even for non-Urgent, elective care such hip operations or hernia surgery, you will usually get treated, after what could be a painful and lengthy delay on the waiting list.

Waiting for non- urgent surgery such as cardiac procedures, colonoscopies and cataract removals can have a huge impact on your quality of life.

You would also not have a choice of surgeon, would have to go to the nearest public hospital and would be limited to medicines and pharmaceutical products approved by MEDSAFE and also funded by PHARMAC. (There are many treatments and medicines that are NOT funded by PHARMAC, but would be covered under certain private medical insurers)

Medsafe, the New Zealand Medicines and Medical Devices Safety Authority, is the medical regulatory body run by the New Zealand Ministry of Health, administering the Medicines Act 1981 and Medicines Regulations 1984.

The Pharmaceutical Management Agency, better known as Pharmac, is a New Zealand Crown entity that decides, on behalf of District Health Boards, which medicines and pharmaceutical products are subsidised for use in the community and public hospitals.

Private Medical Insurance

Around half of all elective surgeries in New Zealand are funded by Private Medical Insurers.

The issue for many New Zealanders is that private medical insurance can be unaffordable and could be looked at as a luxury. However, if you need a hip or knee replacement, you don’t want to be hobbling around for years in pain on the public health waiting list for treatment.
Going Private provides the funding to enable you to have medical treatment when you need it and gives you access to a broader range of treatment options that are not available to you through the public health system. You would have access to the latest treatments and drugs available. This is one of the main reasons I would recommend considering taking Private medical insurance, as it could make all the difference.

Did you know that a large percentage of approved medical drugs are not funded in the public system?

With No waiting list, you can get it done and recover, knowing that the bills are paid. You would also get to choose your specialist and be able to go to a private hospital. Taking control of your treatment and health could save you a lot of pain and money in the long run.

There are many different Private Medical insurance plans and insurers available in New Zealand that provide full comprehensive cover or just Hospital and specialists and tests.

Quantum Finance has several qualified, Senior Advisers for you to talk to if you have any questions regarding Private Medical Insurance. We are accredited with most of the Major Insurance Companies in New Zealand which enables us to give you the best, unbiased advice.

Karl Taylor, father-of-six with terminal lung cancer found hope when he was told that a drug called Alectinib could prolong or even save his life. Unfortunately, the drug came at a huge cost. The 54-year-old man would have to pay $6,500 per month to stay alive. Read more on Karl’s story. Don’t pass on opportunities that could help save your life, get in touch with Quantum Finance.

Let me help you find the perfect, most affordable cover suitable for you and your family. For a free, no-obligation quote or consult – give me a call on 0274 579 930 or send me an email with any questions you may have. My email address is Linda@quantumfinance.co.nz.

 

Linda Rohrbeck
Senior Risk Adviser
Quantum Finance

Market Volatility in NZ

In this article we look at Market Volatility in NZ it’s causes and ongoing effects.

Some recent articles have noted that NZ investors are bracing themselves for some turbulence in the 2019 year ahead as global equity markets continue to exhibit volatility after a fairly strong run in recent years. NZ is somewhat fortunate in the fact that in recent times we have been shielded from the fairly turbulent activity seen in the US stock market and in other global markets however we are not entirely immune from the effects of what impacts our major trading partners and other markets in general.

While the US stock market has bounced back from a very large fall in circa December, the Dow is still down from its record highs, and the Fed is still sending mixed signals about interest rates which could impact us. US China relations remain strained which puts the global market on tender hooks. This combined with volatility in European markets, and an uncertain Brexit add to global anxiety.

As an export driven nation we rely heavily on the stability of global markets and in particular the economic performance and outlook of our major trading partners – particularly China and Australia but also other key markets.

There has been concern over a slowing in China, and of course a spill-over effect from recent negative trends in the Australian housing market. However, housing continues to be a strong economic driver for NZ with demand continuing to significantly outweigh supply – albeit we struggle with labour/capacity constraints to rectify this in the short term and there is some reluctance now showing from the larger players in the construction industry following the recent failures of some of these players.

Notwithstanding, we are still seeing strong residential and commercial construction activity both in Auckland but also in the regions. The most recent Global Dairy Trade saw product prices rise foor the 8th consecutive time providing a positive lift for farmers. With a steady NZD other exports are also trending positively.

The RBNZ most recently held the OCR at its current low of 1.75% and there is generally no perceived movement until 2021. Hopefully a continued low interest rate environment with strong employment levels will support retail spending and business investment.

Overall a positive outlook is generally predicted although a cautionary watch needs to be kept on externalities (globally) and the possibility that Banks may tighten credit in response to proposed higher capital requirements.

4 life saving tips to minimise frustrations when buying your first home

I remember the first time my wife mentioned to me that we should start thinking about purchasing our first home. I’m a very conservative personality, so my first reaction was, “how are we gonna do that? Where do we even begin?” We’ve all been there before right? Where a task that lies ahead of us seems daunting and intimidating. Well, I’m here to help you along the way. What seems like a massive mountain to tackle, is actually a series of small steps that lead to an amazing destination.

Here are the top four tips that will make life a lot easier when you are considering purchasing your first home.

  1. Can you afford it?
    1. I know, I know… this seems like common sense right? But the reality is often most people don’t realise all of the costs involved in home ownership. For example: Have you thought about how much the rates are going to cost? How about insurance? What about solicitor’s fees? And if you have less than a 20% deposit, Low Equity Premium fees? Annual maintenance costs? Etc. All of these can add up to thousands and thousands of dollars. However, nothing to worry about if you are aware of, and prepared in advance for these costs.
  2. The paperwork nightmare!
    1. Banks want to know everything about your financial history. What does that mean? You are going to have to gather a lot of paperwork to show that you are a responsible and trustworthy borrower. Makes sense though right? Wouldn’t you want to know everything about the borrower if you were lending upwards of half a million dollars or more to someone? So be prepared. Have your paperwork ready for that first meeting with your broker or banker. Here’s a short list to help you start preparing.
      1. 3 most current months bank statements
      2. 3 most current months payslips
      3. Copy of your ID (passport, driver’s license)
      4. Last 2 years financials if you are self employed
  3. Number discrepancy
    1. Now, we’ve all been on the websites to see how much we can afford right? Here’s a little golden nugget to save you from becoming frustrated later on. Those websites are NOT the bank! Banks pad the interest rates and margins in order to make a safer bet on a borrower. Here’s an example: on the website we can type in that super low interest rate for qualifying, but the banks don’t use that rate! Yep, you heard right. They use a cushioned rate upwards of 6% or higher to qualify you. Why? Because then they know you can afford the payments if and when the rates go up. They’re in it for the long run, so they need to know you can afford those payments in the long run.
  4. Apply for KiwiSaver withdrawal and HomeStart Grant EARLY!   
    1. On average, these processes can take upwards of three to five weeks to get confirmation from the providers. Head on over to the KiwiSaver website and the Housing NZ website to gain access to the applications.
    2. Bonus tip: Make sure you follow through with the HomeStart grant process. Send them the required documentation (sales and purchase agreement, etc). This is something that you have to do yourself, not your broker or solicitor.

I wish I had known these little tips when we bought our first home. It would have saved us a lot of headache during the process. I would encourage you to have a good conversation with your broker. Ask questions. If you are a personality that likes detail and processes and would like to know everything that is going on, then tell your broker or banker that. We will communicate as much or as little as you prefer. The key is communicate. Ask questions and be prepared. Then, sit back and enjoy the journey to owning your first home!

In the Spotlight – Directors & Officers Liability (D & O)

Whilst most Insurance Brokers have been pushing this barrow for quite a long time now the up-take of businesses taking it has been disappointing.

Two things have helped in recent times, the first being the initiative from Insurers to package D & O cover up into a suite of Liability products including other liability risk classes that in the past had to be taken as ‘stand-alone’ policies.

The second and more recent thing being some high profile court cases where Directors of companies are being sued by unsecured creditors, most notably the recent Mainzeal case involving ex New Zealand Prime Minister Dame Jenny Shipley, which is probably why it gained so much attention.

While a construction business the size of Mainzeal would have had its own standalone Directors & Offices liability policy the ‘Management’ Liability (ML) suite of covers has been specifically set up for SME businesses (Small to Medium size Enterprises).

As well as the D & O protection other covers typically found in an ML policy might include:-

  • Crime Protection (criminal actions of employees against the company or their clients)
  • Employment Practices Liability (provides indemnity & defence associated with a claim alleging a breach of employment practice laws, a grievance)
  • Liability Consequential Loss (coverage for financial loss suffered resulting from interruption to the normal course of business from a liability claim)
  • Corporate Liability (reimbursement to the company following the death of an insured director)
  • Others might include Tax Audit & Review, Cyber Liability, Kidnap Ransom & extortion.

General, Employers and Statutory Liabilities are always taken as a minimum, on their own they are referred to as ‘Combined’ Liabilities.

In providing this Management Liability option for ‘SME’s the Insurers have been able to drastically reduce the required premiums to cover these exposures.

As a mass type product with lower than usual limits of indemnity (amount they (the insurer) will pay) the underwriting* is much less involved.

Taking an ML policy with maybe six sections to it will often cost much less than taking two individual policies which, for the size of these business, the Insurers would not be nearly so interested in in any case.  It is easier for them to offer this packaged policy selling many more numbers of them.

If you are interested in extending your own combined liabilities policy in to a Management Liability packaged policy please contact me for terms.

 

*Underwriting – the process insurers go through to work out their premium for a risk/exposure.

Investing for Beginners

I’m sure I am not the first one to tell you how important investing for your future is, but it’s not always so easy to know where to start. There are so many options, such as the Sharemarket, Kiwisaver, investment properties, term deposits etc. but its understanding what is going to work for you that matters! Everyone is different when it comes to handling investments. Here are a few point to consider if you want your money to MAKE YOU MONEY!

So what do I need to do BEFORE I start investing?

  1. Firstly, pay of as much debt as you possibly can! Things like credit cards, personal loans, Qcards can have a big impact as to how much you can save to put towards an investment. The less small personal debt you have, the better!
  2. Live on less than you make. For some this is harder than it sounds. Realistically, you can NOT become successful if you live pay check to pay check. You need to learn to budget certain amount for different expenses. An easy way of doing this is having multiple bank accounts, each allocated to different things like spending, car, savings, power bill etc. Work out how much per week you spend on each and allocate that amount to its respective accounts, I can tell you now, you do this, saving just became a whole lot easier!
  3. Allocate yourself an ‘Emergency fund’. We all have to unexpected bills that come with no warning, but if you are prepared, it means you can carry on without any disruption to your savings and investment goals! Try to have in this account 4-6 weeks’ worth of income at any one time.

Quick Tip

  • If you have trouble when it comes to spending too much money, why don’t you try taking out a certain amount each week in CASH and only use that for your spending? It helps you keep track of how much you have allocated yourself to spend for that week!

What Now?

Investing can be a very tricky thing to jump into if you haven’t done your research. Some investments have an element of ‘risk’ to them. Basically, the higher the return on your investment, the higher the risk is.

Two Types of investments if you have NO CLUE as to what you are doing.

Term Deposits

term deposit ensures your money will earn interest at a fixed rate, for a fixed term. There’s little to no chance of losing your money, so it’s a good option for cautious savers. It’s low maintenance. One disadvantage is that once you lock your cash away in a term deposit, there’s not a lot you can do with it until the term is up.

KiwiSaver

Since your money is in an investment fund, it can go up and down in value, so you can lose money, unlike term deposits. Because of this, you do have a slightly higher return on investment. To be honest, because you, your employer as WELL as the government are putting money into your KiwiSaver, it will be VERY hard to lose everything as you are not just banking on the interest to make you money.

If you are looking to invest larger amounts of money, but wanting to go down the route of shares, bonds etc instead of your more secure term deposits, savings accounts, would be to meet in person with a Financial Advisor. They will be able to learn about your current situation and what your goals are and help you tailor the perfect plan to help start you on the right path to investment. It is very important to get the RIGHT advise the first time. Nothing worse than losing your hard earned money just because you were not completely aware of all advantages and disadvantages of certain types of investments right?