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Trust Issues: Can Insurance Companies Be Trusted? · That Home Loan Hub

• 0:10
  SPEAKER_00: Hello and welcome back to that Homlon Hub.
• 0:13
  SPEAKER_00: I am joined by Rebecca, our resident insurance advisor.
• 0:16
  SPEAKER_00: Hello, Rebecca.
• 0:17
  SPEAKER_00: Hello.
• 0:17
  SPEAKER_00: Good to see you today.
• 0:19
  SPEAKER_01: You too.
• 0:20
  SPEAKER_00: You had to pause a button.
• 0:21
  SPEAKER_01: I didn't know I was about to say things, but I'm like, I should be more polite and say you too.
• 0:27
  SPEAKER_00: I love it.
• 0:28
  SPEAKER_00: Thank you so much.
• 0:29
  SPEAKER_00: Also, what are we talking about today?
• 0:31
  SPEAKER_01: Uh so a big one is trust in insurance companies.
• 0:34
  SPEAKER_01: So the erosion of trust.
• 0:36
  SPEAKER_01: People don't trust that they'll pay out with claims.
• 0:41
  SPEAKER_01: Wow.
• 0:41
  SPEAKER_01: That's a big one.
• 0:42
  SPEAKER_01: Yes.
• 0:43
  SPEAKER_01: Okay.
• 0:43
  SPEAKER_01: So I think a lot of it comes from years ago, in particular with fire in general, when there was a struggle with claims and everything.
• 0:49
  SPEAKER_01: What's fire in general?
• 0:51
  SPEAKER_01: Sorry.
• 0:51
  SPEAKER_01: So that is house and contents and car.
• 0:54
  SPEAKER_01: So with that, it sort of has moved over into the risk space, the life, the trauma, and all that.
• 1:00
  SPEAKER_01: They had they still have that feeling because of it.
• 1:03
  SPEAKER_01: Mm-hmm.
• 1:03
  SPEAKER_01: Um, so they feel like insurance companies go out of their way not to pay.
• 1:10
  SPEAKER_01: So I think that's a big one.
• 1:12
  SPEAKER_01: You know, you have a chat with someone and they say, Oh, yeah, well, you know, those companies, they're not gonna pay me out anyway.
• 1:17
  SPEAKER_01: They they want a reason not to.
• 1:20
  SPEAKER_01: And so a big thing with that is explaining, well, actually, insurance companies do do their best to pay as long as you are, you know, if you fully disclose all of your conditions, there's no reason for them not to pay.
• 1:32
  SPEAKER_01: And that's what we're here for.
• 1:33
  SPEAKER_01: We'll argue those claims, right?
• 1:35
  SPEAKER_01: We'll argue to get them paid out.
• 1:38
  SPEAKER_00: Yeah.
• 1:38
  SPEAKER_00: And you're right, like uh, I think with all the natural disasters that we've had in, you know, from Christchurch to Auckland hurricanes and slips, etc., etc., and there's still people that haven't been paid.
• 1:49
  SPEAKER_00: Um, there's still, you know, a lot of trauma around insurances and that naturally will have a follow-on effect.
• 1:56
  SPEAKER_00: If for mortgages, you must have a house insurance.
• 2:01
  SPEAKER_00: For life insurance and mortgage protection, you don't need to have those insurances, right?
• 2:05
  SPEAKER_00: Exactly.
• 2:06
  SPEAKER_00: And this is where people go, well, if I don't have to have it, why should I have it?
• 2:10
  SPEAKER_00: Yeah.
• 2:10
  SPEAKER_00: Because it's not going to pay out anyway.
• 2:12
  SPEAKER_01: Yeah.
• 2:13
  SPEAKER_00: And how do we change the narrative?
• 2:15
  SPEAKER_01: I think it is just educating people about the claims experience we've had and actually getting the claims paid, but also just explaining to them about their disclosures, like that they, you know, if they disclose everything, then we will get an offer from the insurance company.
• 2:31
  SPEAKER_01: If something's not excluded and you get that condition, and it's in that policy wording, you will be paid.
• 2:37
  SPEAKER_01: Then definitely not going out of their way not to pay you.
• 2:40
  SPEAKER_01: But I think there's a contract, uh, sorry, there's a law going through Parliament at the moment on insurance.
• 2:46
  SPEAKER_01: It's to it's advanced a bit.
• 2:49
  SPEAKER_01: I don't know how far along it is at the moment, but it's supposed to first of all simplify policy wordings so the people that are insured can understand what they're insured for.
• 2:59
  SPEAKER_01: Some of those policy documents are ridiculous.
• 3:02
  SPEAKER_01: Yeah.
• 3:03
  SPEAKER_01: Like 40 pages of stuff that half of it you don't understand, right?
• 3:09
  SPEAKER_01: Um, and another big thing is on the claim side.
• 3:12
  SPEAKER_01: There's gonna be a big push that they within a certain time frame, they have to assess the claim and pay the claim out.
• 3:18
  SPEAKER_01: Like they're they're cracking down on insurance companies and the period they'll do it in, and they've got to have it once it passes, everything's got to be in place by 2029.
• 3:26
  SPEAKER_01: So so people are aware that there are issues and they are being worked on.
• 3:31
  SPEAKER_01: Um, so I think that will help as well.
• 3:34
  SPEAKER_00: Okay.
• 3:35
  SPEAKER_00: That's um that's a very important topic, I think, because people, when they pay for something, they want something back.
• 3:42
  unknown: Yeah.
• 3:42
  SPEAKER_00: Right.
• 3:43
  SPEAKER_00: And that's what it comes down to fundamentally, is that ideally you'd want to be claiming on your life insurance.
• 3:49
  SPEAKER_00: But if you are paying, you want to have peace of mind that if you do go to claim, then it will get paid out.
• 3:57
  SPEAKER_00: And I think part of the process, they should really look into those online insurance providers, right?
• 4:02
  SPEAKER_00: Where people go in, get an insurance, click buttons, and it's issued and they pay money for something they don't even know what.
• 4:09
  SPEAKER_01: Yeah, they've got no idea what they're covered for.
• 4:10
  SPEAKER_00: And then when it comes to claim time, they realize that, oh, you know, this wasn't covered or that wasn't covered.
• 4:15
  SPEAKER_00: And I think that causes a lot of grievance.
• 4:17
  SPEAKER_01: Absolutely.
• 4:18
  SPEAKER_01: And it's also that, like, especially with the online companies, what the types of policies are called, like a trauma policy, people expect any traumatic event to pay out, right?
• 4:27
  SPEAKER_01: They take out this trauma, they think if I have a traumatic event, even like a mental health situation.
• 4:31
  SPEAKER_01: I've had people contact me saying they got this cover elsewhere and they had a car crash and it was very traumatic.
• 4:36
  SPEAKER_01: Would they be paid out?
• 4:38
  SPEAKER_01: Like they don't understand what the cover actually is, but they think they've done the right thing.
• 4:42
  SPEAKER_01: And they don't mean they've done the right thing in taking out some sort of cover, but they're paying for something they don't understand and that might not pay out for their situation.
• 4:50
  SPEAKER_00: And like what is redundancy cover, right?
• 4:53
  SPEAKER_00: Uh in my view, when I first started as an insurance advisor and I learned about the redundancy cover, I kept asking my BDMs, going, What's the point of this redundancy cover?
• 5:03
  SPEAKER_00: Because you pay an omnialag for it, but then you can't claim on it for a period of time.
• 5:09
  SPEAKER_00: And usually during that period of time, people go and find another job anyway.
• 5:12
  SPEAKER_01: Yeah.
• 5:12
  SPEAKER_00: And it only pays for like six months.
• 5:14
  SPEAKER_00: Yeah.
• 5:15
  SPEAKER_00: So it's like, what's the point of this cover?
• 5:17
  SPEAKER_01: Yeah, that is it.
• 5:18
  SPEAKER_01: It's an interesting one.
• 5:19
  SPEAKER_01: Redundancy cover is such a I think a lot of insurance companies don't even offer it anymore.
• 5:24
  SPEAKER_01: Um, and that's why they've also done it as an add-on to income protection or mortgage protection.
• 5:29
  SPEAKER_01: Like you can't do it as a standalone policy anymore.
• 5:33
  SPEAKER_01: Uh, because it is so hard to claim on.
• 5:37
  unknown: Yeah.
• 5:37
  SPEAKER_01: But people think they made redundant, they'll be able to claim on it.
• 5:40
  SPEAKER_01: If they take it out online or if it's not explained to them properly, they think, well, I'll be covered.
• 5:45
  SPEAKER_01: But like you said, there's a wait period.
• 5:47
  SPEAKER_01: By that point, you probably got another job, but only pays for six months.
• 5:50
  SPEAKER_00: Yeah.
• 5:51
  SPEAKER_01: Because I think what was the wait period?
• 5:52
  SPEAKER_01: Three months, six months?
• 5:54
  SPEAKER_01: Six months.
• 5:54
  SPEAKER_01: You had to have the job for six months.
• 5:56
  SPEAKER_01: So if you've got a new job and you had this redundancy cover, and then like three months later, for some reason, you're gone.
• 6:03
  SPEAKER_01: You're not covered.
• 6:05
  SPEAKER_00: Yeah, absolutely.
• 6:06
  SPEAKER_00: Um, good point.
• 6:07
  SPEAKER_00: So um, so I think that brings me to the point that people should really know what they're getting.
• 6:15
  SPEAKER_00: Yeah.
• 6:15
  SPEAKER_00: In order not to have that trust broken.
• 6:18
  SPEAKER_00: Absolutely.
• 6:18
  SPEAKER_00: They should understand what company they're signing up with, what's the rating of that company, what's the claim um payout rate.
• 6:25
  SPEAKER_00: And we've got all that information, right?
• 6:27
  SPEAKER_00: Usually we can provide that information up front to people.
• 6:31
  SPEAKER_00: And that will base their decision making and give them hopefully that piece of trust that they need.
• 6:37
  SPEAKER_01: Yeah, absolutely.
• 6:38
  SPEAKER_01: And like I said earlier, like that's what we as advisors are here for, anyway, as well.
• 6:43
  SPEAKER_01: If you have any of those questions, like that is the point of us, right?
• 6:46
  SPEAKER_01: We have to like, first of all, to give you all of the information you need to feel comfortable with the policy, but secondly, to fight for you and claims.
• 6:55
  SPEAKER_01: So even if you're not sure about an insurance company paying out, that's what we're here for.
• 7:01
  SPEAKER_00: Awesome.
• 7:02
  SPEAKER_00: Thank you so much, Rebecca.
• 7:03
  SPEAKER_00: Any other final thoughts or wisdom?
• 7:06
  SPEAKER_00: No.
• 7:08
  SPEAKER_01: Um I think I've used it all up.
• 7:10
  SPEAKER_00: Awesome.
• 7:10
  SPEAKER_00: Rebecca and I are planning an insurance investment investment.
• 7:14
  SPEAKER_00: Where did that come from?
• 7:15
  SPEAKER_00: Insurance webinar, um, which will be coming up soon.
• 7:20
  SPEAKER_00: So stay tuned.
• 7:21
  SPEAKER_00: If you want to hear more, comment and we'll send you the webinar link.
• 7:26
  SPEAKER_00: Because what we feel is that spreading the message across and letting people know that this options exist, right?
• 7:33
  SPEAKER_00: This insurance providers exist, this different products exist, and it's all for you to make your life better if something were to go wrong.
• 7:42
  SPEAKER_00: So um stay tuned.
• 7:43
  SPEAKER_00: If you want to know more, reach out.
• 7:45
  SPEAKER_00: We're always here to help you.
• 7:46
  SPEAKER_00: Thank you so much.