Get Sorted: Said no one about insurance

Most of us take too long to get insured. Picture / 123RF

Why is it the whole insurance thing can leave us scratching our heads sometimes. It can feel like it's not even a real thing.

So many questions, and too often we get left with vague answers.

For starters:
Why is it – no one ever seems to say much about the limitations of a certain policy? You know, when it's a good fit, when it's not.

If I were buying a ute, the sales guy would easily tell me how much it could haul. If it's unsuitable, I'd move on and look at a different model.

It's hard to say the same for insurance.

"This policy only works for those who ..." said no one, it seems.

Why is it – no one explains when don't we need insurance? This doesn't seem to get discussed much either, and we're much more likely to feel that we never have enough cover.

Admittedly most of us take too long to get insured. Had we started earlier, we could have locked in some low premium levels for life. Something to think about for the kids, perhaps?

But it also seems we're behind in thinking about when we no longer need insurance and can cast it off.

The whole thing is on a lag – we get cover too late, then keep it longer than we need.

Or we buy insurance when we're already covered, either by another policy, other consumer guarantees or state-funded safety nets like ACC.

Why is it – that you practically need an expert adviser in order to get a claim through the system?

The insurance experience is often not great. You might start with travel insurance, and then when your favourite Ray-Bans get lost and you make a claim, you find the policy doesn't pay out and was a bit useless for the smaller stuff. Car insurance is typically next, and that's about it for a while.

Meanwhile, we start working and often overlook protecting our biggest asset – our ability to earn.

I feel lucky to have found an adviser with a lot of experience in underwriting and "working" the system to make sure claims get paid when they're supposed to. But not everyone has an expert at their beck and call.

The way we're doing everything online these days means we're often whipping out the card and buying cover on the fly. Who knows if the policies are right for us? Who knows if they'll work when we absolutely need them to?

Like I said, so many questions. If you have an insurance adviser of your own who answers these, hang on to them!

Find a good tailor
For a while there my goal was to get the right insurance for my situation. Not everyone needs the same cover, and there is no "one size fits all".

An insurance adviser is much like a tailor, actually – not just to get your fit right, but to make alterations over the years as well.

At the time I even hacked my daily computer password to be "getcover1" to remind myself. It wasn't until "getcover4" kicked in almost a year later that I finally could say I had the right insurances in place.

Get Sorted is written by Sorted's resident blogger, Tom Hartmann (@TomHartmannNZ). Check out the guides and tools from Sorted – brought to you by the Commission for Financial Capability – at sorted.org.nz