Winter 2010
Newsletter

With Winter already upon us we thought we’d bring you a little ray of sunshine to your inbox. Within this edition of our newsletter we will give you a final reminder of how we can help you make substantial long term savings on the amount you pay for your Life Cover prior to tax changes commencing on the 1st July 2010.

In this edition we discuss:

Life Cover Savings
Quality of Bank advice and product
Mortgage Protection and Income Protection
Completion of applications forms
KiwiSaver returns

LIFE COVER SAVINGS – LAST REMINDER BEFORE TAX CHANGES

On the 1st July 2010 the way that Life Companies are to be taxed is to change. As a consequence, it appears that the cost of Life Cover will increase. Increases of between 15%-30% have been mentioned.

There are ways to combat this but time is running out to allow us to help you. If you want to maximise your potential savings please get in contact immediately to enable us to beat the 1st July 2010 deadline.

QUALITY OF BANK ADVICE AND PRODUCT

This week a client phoned with some queries regarding the Mortgage Protection Policy he recently put in place through ourselves. He had recently met with a bank representative to discuss re-fixing his mortgage and the representative also proceeded to give him some ‘advice’ on the structure of his Mortgage Protection Policy. Her poor ‘advice’ greatly concerned us as it highlighted that either her knowledge was insufficient to allow her to be making any comments or recommendations around Insurance Products or she was desperate to hit her sales targets before the end of the month and was prepared to provide misinformation to her customers to achieve this.

This is not a one off. In previous Newsletters we have already made mention of the Banks converting good quality cover across to their too often significantly poor imitations.

It both alarms and angers me to think about how many other people are getting shoddy advice from their banks in what is an extremely important area.

The Banks only have a choice of one provider when recommending Insurance – their own! They are targeted on selling their own cover even when it gives you less chance of a claim than products offered by Life Companies who provide Insurance as their core business.

Please remember also that we at Christchurch Insurance Centre have a choice of multiple insurers, products and payment structures when it comes to our recommendations. We truly do the shopping around for you and our recommendations are always based on providing the most relevance and value for money available in the marketplace at any given time.

As we mentioned, the advice given to our clients from the Banks has greatly angered and concerned me. I strongly urge anyone of you with bank Cover to sit down with one of our advisors to give you a free, honest assessment of your bank cover compared to that available in the marketplace.

MORTGAGE PROTECTION vs INCOME PROTECTION

One of the issues brought up by our client after the ‘advice’ provided by the bank representative was whether it was better to have Mortgage Protection or Income Protection – or indeed a combination of both.

The answer is that it depends!

Things we take into consideration are such things as income earned, split of income between house owners, size of Mortgage, regular repayment amounts and the goals and dreams of the individuals.

Benefits of Mortgage Protection include 100% certainty at claim time and no tax implications on benefits received.

Income Protection can often offer you a higher sum insured and the possibility of tax deductibility of the premiums but does not offer 100% certainty at claim time. If you are uncertain if you have the right plan structure in place, please contact us and one of our advisors will give you a free, honest assessment of your present plan.

COMPLETION OF APPLICATION FORMS
Again there has been another article on Fair Go regarding problems at claim time due to non-disclosure of material information on the application form. Whilst I feel that the article was not a balanced or fair assessment of events, it is a timely reminder that it is very important if you have any insurance cover in place, that the application form was completed fully at the date of your application This will ensure that there is less chance of a nasty surprise at claim time.

Should you have any concerns about non-disclosure on any life, trauma, total and permanent disability protection, income protection, mortgage protection or health cover you have in place please let us know and we will be happy to work with you to review the initial application.

AON STYLE COVER

Home and Contents
Motor Vehicle
Boat
Landlords Protection
Personal legal defence costs
Travel Insurance

We are delighted to announce that we now have the ability to provide the above Insurances through AON, the largest Insurance Broker in New Zealand.

If you wish to compare your present cover to that offered by AON, please give Eric Dobbs at the office a call on 03) 379 6847 and he will be delighted to assist.

KIWISAVER RETURNS

More good news for those of you with Fidelity KiwiSavers!

The Options Kiwi Fund continues its reign as the top-performing KiwiSaver fund in the two years to 31 March, according to FundSource’s latest tables.

With an annualised return of 14.38% pa, it was #1 out of the 112 KiwiSaver funds in FundSource’s survey over that period.

Over the same time period, four of Fidelity Life’s five funds occupied the top 16 places:

Options Kiwi                FIRST out of 112
Balanced Kiwi               10th
Aggressive Kiwi            11th
Conservative Kiwi          16th

No other fund manager had as much success!

In the hotly-contested “diversified” sectors the Balanced Kiwi ranked 1st out of 31 in its sector, the Aggressive Kiwi 3rd out of 26, Growth Kiwi 5th out of 26 and Conservative Kiwi 5th out of 22.

See results below

¹The Capital Guaranteed Kiwi Fund has the benefit of a guarantee from Fidelity Life that the unit price on 31 March each year will never be lower than it was on 31 March the previous year. The Guarantee is provided by Fidelity Life Assurance Company Limited (“Fidelity Life”) to the Trustee (Guardian Trust Superannuation Trustees Limited) of the Fidelity KiwiSaver Scheme. The guarantee is given by Fidelity Life in its capacity as the administration and investment manager of the Scheme and is conditional upon this appointment continuing. Fidelity Life’s obligations under the guarantee are unsecured and will rank behind all secured and preferential creditors of Fidelity Life, together with all life insurance policy holder liabilities and will rank equally with all other unsecured creditors. For further details as to the terms and conditions of the guarantee please refer to the Fidelity KiwiSaver Scheme Investment Statement.

²The Options Kiwi Fund has a high risk profile and is subject to significant volatility. It uses leverage and derivatives (options contracts) that could generate and enhance any returns or generate substantial losses. As with all the Fidelity KiwiSaver Scheme funds, please consult your financial adviser on what proportion of your retirement savings should be in the Options Kiwi Fund.

If you wish to discuss any of the topics covered or want to review your Insurances or Investments please contact the office on 03) 379 6847 or email admin@supernz.co.nz and we will arrange for one of our consultants to meet with you.

Best regards,

Ian Greig