Life Insurance
Protect your family's financial future if the worst happens.
What Is Life Insurance?
Life insurance is the foundation of any comprehensive personal insurance plan. When you pass away, your policy pays a lump sum — typically $250,000 to $2 million — directly to your nominated beneficiaries. That money can pay off a mortgage, replace years of lost income, fund children's education, or simply give your family breathing room during an impossibly difficult time.
New Zealand has relatively low rates of life insurance uptake compared to other developed nations — and many who do have cover are underinsured. A common rule of thumb is to have 10 times your annual income in life cover, but the right amount depends on your mortgage, dependants, existing assets, and your family's cost of living.
Life insurance can be purchased as a standalone policy or bundled with trauma, income protection, and health cover. Bundled policies often attract premium discounts. A licensed adviser can help you calculate the right sum insured and structure a policy that works within your budget while protecting what matters most.
What's Covered
Lump sum paid on death — typically $250K to $2M
Terminal illness early payout (12–24 months to live)
Mortgage and debt repayment protection
Replaces years of lost income for dependants
Funeral and estate costs covered
Children's education funding
Trauma cover available as add-on
Joint or single life options
Who Needs Life Insurance?
Parents with young children who depend on your income
Anyone with a mortgage or significant shared debt
Business partners with a buy-sell agreement
Sole breadwinners in a household
Anyone whose death would cause serious financial hardship for others
Worked Examples
These are illustrations of how this type of cover is designed to work. They are not accounts of real people, and they are not records of any insurer’s claim decision. What is actually payable depends on the plan you hold, its benefit maximums and any waiting periods or exclusions that apply to you.
Young father passes unexpectedly
A 37-year-old Auckland tradesman passed away suddenly from a cardiac event. He had a $400,000 mortgage and two children under 10.
His $500,000 life policy paid out to his wife within 3 weeks of claim lodgement. The mortgage was cleared, and remaining funds provided 4 years of living expenses while she rebuilt financially.
Terminal illness early access
A 54-year-old woman was diagnosed with terminal cancer and given 10 months to live. Her life policy included a terminal illness benefit.
The full $350,000 sum was paid within 30 days while she was still alive — giving her time to pay off the family home, plan her estate, and travel with her grandchildren.
NZ Providers Offering This Cover
Which of these can actually be quoted for you depends on the agencies your broker holds. Some New Zealand insurers deal direct only. We do not rate or score insurers.
Partners Life
Life Cover pays on death or terminal illness diagnosis
AIA
Note that AIA Cover for Life and AIA Essentials Life Cover are not eligible for the Vitality discount
nib
Life cover available alongside its health insurance range
UniMed
Primarily a health insurer; ask what is available alongside its health plans
Southern Cross
Life cover is offered through a separate Southern Cross group entity
What Affects the Cost?
Premiums for Life Insurance vary between individuals. These are the key factors that determine your rate:
Sum insured — the lump sum amount chosen
Age — life cover gets more expensive each year you wait
Smoking status — one of the biggest premium factors
Health history — heart conditions, diabetes, cancer history
Occupation — some high-risk occupations attract loadings
Frequently Asked Questions
What does Life Insurance actually cover?
Life insurance provides a lump sum payment to your family if you pass away. Combined with health insurance, it gives your loved ones financial security when they need it most.
How much does Life Insurance cost per month?
We cannot give you a price for this cover, because no New Zealand health insurer publishes a full premium schedule. What we can tell you is what moves the number: your age, your medical history, the excess you choose, the level of cover, and who else is on the policy. An adviser can quote your actual situation at no charge.
Are pre-existing conditions covered?
Pre-existing conditions are typically excluded from cover, or may be subject to a premium loading. The definitions vary by insurer, and some conditions may be covered after a stand-down period. An adviser will help you understand each provider's approach before you commit.
How do I claim?
Claims processes differ by insurer. Most offer online or app-based claiming, and for surgical or hospital treatment the provider will often bill the insurer directly where the treatment has been approved in advance. For everyday cover you generally submit receipts and are reimbursed. Ask your insurer what their current process and turnaround are.
General information, not financial advice
Information on this page is general in nature and does not take into account your personal circumstances, goals or financial situation. BestHealthInsurance.co.nz is not a Financial Advice Provider. We do not compare policies for you, we do not recommend an insurer, and we do not give financial advice.
When you request a quote, we pass your details to one of the specialist brokers or underwriters we work with. Where that is a broker, they are an independent, licensed New Zealand Financial Advice Provider: they compare the insurers they hold an agency with, give you any advice, and are responsible for that advice. Where an insurer takes the enquiry directly, you are dealing with that insurer’s own team about their own products. Either way, ask them for their disclosure information — what they can advise on, the providers behind it, how they are paid and how to complain — before you act on anything they tell you.
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Get a Quote →Related Guides
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External resources: PHARMAC (funded medicines) · Health New Zealand (Te Whatu Ora) · FMA — Insurance guidance
BestHealthInsurance.co.nz is an independent referral service. We connect you with licensed insurance advisers regulated under the Financial Markets Conduct Act 2013. We do not provide financial advice. See full disclaimer.