Pinnacle Life today launched a $15,000 funeral cover policy which complements its life cover and mortgage cover products. 

The policy is applied for and issued immediately online in the same way that existing products are delivered. The buying process from application to policy issue is fully automated, with consumers receiving their policies via email which they can print off and file.  

Whilst the product is designed essentially for the 50 plus consumer, it is available online to anyone aged 30 to 69. Being a ‘guaranteed issue’ product, it can be purchased by anyone regardless of health and lifestyle.  

It’s as straightforward as going online and buying a CD… maybe even easier!

Applicants purchasing the funeral cover policy are led through a few simple questions including height and weight which are taken into account in calculating the price. Level premiums are paid only until age 85, after which cover continues free of charge through to age 100.  

The policy is straightforward and consumers should have no problems understanding it. The entire process can be completed in a matter of minutes, at the end of which the applicant will have their policy and they will be covered.  

Today’s ‘instant funeral cover’ follows the launch of instant life cover and instant mortgage cover by Pinnacle Life just over a year ago.

When well known finance companies hit the skids, it’s bad. But when their names get confused with secure profitable companies, it causes other problems.  

High profile Hanover Finance, has become the latest casualty of the finance company sector meltdown.  Hanover Finance said late today it was to freeze about half a billion dollars of investors’ money and start working on a restructuring plan. (Hmmm) 

With 13,000 investors and $465 million worth of debentures, we’ve been asked several times how Hanover Finance’s problems could impact the business of Pinnacle Life.  Well??

Answer… NOT AT ALL!  

Pinnacle Life has no business with Hanover Finance.

The confusion arises because Pinnacle Life reinsures it’s policies with Hannover Life Re of Australasia, a gigantic global reinsurance group.     

Hanover Finance and Hannover Life Re are NOT RELATED. (They’re not even spelled the same!) 

Given the number of people that have raised this question with us, we decided to post this clarification on our blog.

Authors of this blog congratulate Noel Vaughan, managing partner of Pinnacle Life on achieving this excellent milestone.  

Noel launched Pinnacle Life on 23 July 1998 as the first specialist life insurance company to offer policies direct to consumers over the phone. Established as a highly efficient business, Noel offered life insurance policies at 20% lower cost than the rest of the market, a proposition that continues to be offered by Pinnacle Life today.  

On the strength of this simple consumer value proposition, Noel delivered steady, profitable growth every year since inception along with a reputation for delivering the best value life insurance in NZ backed by quick, personal service.   Along the way, Pinnacle Life has enjoyed a supurb working relationship with both DraftFCB (advertising) and Hannover Life Re of Australasia (reinsurance) and these relationships have contributed significantly to Pinnacle Life’s success.  

Last year Pinnacle Life took a further step forward becoming the first life insurer in the world to offer instant, underwritten life insurance direct-online to consumers, culminating in its winning a prestigious international media award for the design of its website.   

Establishing a successful life insurance company from scratch is no mean feat and certainly not for the faint hearted. Noel can be extremely proud of what he and Pinnacle Life have achieved.

Some life insurance ads capitalise on ‘guilt’. Others try to tap into your paternal/maternal instincts… happy families running along beaches… and so on…    

But here’s one from Youtube about how much your family will love you if you die leaving them a mouth-wateringly large life insurance policy .  

We think it’s great!!!

We received this from Mark Weiss of ezinsurance.com.au and thought it useful to post it. 

“The key is to find an amount that neither leaves your family underinsured nor wastes money by purchasing too much coverage. In order to determine the optimal level of life insurance coverage it is important to consider which family members should be covered and how much support they will need in the event of your early demise. 

Adult children living comfortably on their own will likely not need such largesse, while minor children with years of schooling and support ahead of them may need a great deal of support. Likewise a working spouse with a good income will need less financial support than a non-working spouse with a houseful of kids to take care of. It is important to take these matters into consideration in order to come up with the right size death benefit. 

The amounts of any home mortgages or home equity loans is an important factor as well. In fact many people purchase term life insurance coverage equal to the outstanding amount of the mortgage, for the express purpose of paying that mortgage off in the event of the death of the policyholder. This can be an excellent and cost effective strategy for homeowners, and the amount of coverage can be adjusted as the balance remaining on the mortgage goes down.”  

Thanks for this Mark.

Received this question from a reader…

Q 

My wife and I recently signed up for ’separate’ policies and would like clarification on the issue of ownership. Currently each policy is owned by the ‘insured person’ and therefore if the insured person dies, their estate receives the payout. This is not what we want. If I die, I want my payout to go to my wife and vice versa. 

If we nominate both ourselves as owners on each policy (joint ownership), then in the event of my death will the payment from my policy be split 50/50 to the owners (ie; 50% to wife, 50% to my estate) or will the entire amount be paid to my wife?… this being our preference. 

A 

It can get complicated so I’ll keep this answer as straightforward as I can. 

If you and your wife have separate policies and you are each the owner of your own policy, then in the event of your death, the payout from your policy goes to your estate and in the event of your wife’s death, the payout from her policy goes to her estate. Pretty straightforward. 

If you change the ownership of the policies such that you are joint owners of both policies, then in the event of your death, the payout on your policy will go to the surviving owner… that is your wife… and in the event of your wife’s death, the payout will go to the surviving owner… that’s you. 

There can be problem with joint ownership though. 

If you and your wife become estranged, she will continue to be the beneficiary of your policy upon your death because she is the surviving joint owner. And there is nothing you can do to change that unless she agrees to sign away her rights. Of course if the split is less than amicable this can be problematic. So you could remain bound in this policy for eternity… literally.

We’re not suggesting for a minute that your marriage won’t stay the distance, but it is important to go into this joint ownership with your eyes wide open. 

Also see earlier post.

We received a question along these lines and thought it worthwhile to post the reply on our blog. 

The short answer is … no.

If you’ve taken out a life insurance policy and you’re suddenly faced with a medical health problem there is no need to tell your life insurer. Your life insurer does not need to know and has no right to ask. 

When you take out life insurance, you do so at a point in time. At that point, the insurer asks you about your health and it is your job to answer all their health and lifestyle questions accurately, truthfully and fully. Based on your health at that time, the insurer offers you a policy on specific terms. If your health was good, you will be offered insurance at a low price. If you had health problems at that point, then your price may be somewhat higher.  

Once you have taken out your policy, the risk of your health failing falls on the insurance company.  If you take ill and you die, then you are covered.  

That’s what life insurance is for.

On this blog we mostly talk about life insurance, living longer and how to financially protect your family if you die.  But there’s no reason why a life insurance blog can’t also celebrate life… especially a new one.

Congratulations to Steve (other half of this blog) for the tiny new addition to his family today. We wish Steve’s family and their new son a happy, prosperous and l-o-o-o-o-o-n-g life!

And what would this blog be worth without a few stats, hey??

Did anybody ever tell you to stop drinking so much coffee because it was bad for your health? Or maybe that it would increase your risk of a heart attack or even cancer? 

Well, head for the coffee machine! It seems your worries are over.  

Results of studies carried out over a 20-year period to 2004 have shown that regular drinking of high quantities of coffee – up to six cups a day – was not associated with an increased risk of death and in some cases even offered some health benefits. Ahhhhh, I can just smell those freshly ground beans. 

Research led by Esther Lopez-Garcia of Universidad Autonoma de Madrid in Spain followed 120,000 US men and women who drank caffeinated or decaffeinated coffee. The women were nurses and the men doctors, dentists and other health professionals.  

The study found that women who reported drinking at least two to three cups of caffeinated coffee per day had a 25 per cent lower risk of death from heart disease than women who did not drink coffee and there was a smaller decreased risk for men. The reduced rate of death was largely as a result of lower rates of heart disease. There was also no reported increased cancer risk for coffee drinkers.  

So for anyone who promised themselves they had better cut back on their coffee drinking… it seems there’s no need. Espresso, latté and flat whites never tasted better.  

Saw this great story on realestate.co.nz in which the imagination of one US-based real estate agent in association with a canny vendor came up with the ultimate marketing concept using a life insurance policy.  

The ad goes like this… Buy my house and have the opportunity of getting your money back!   

No, this isn’t some kind of bizarre money back guarantee scheme… it’s a perfectly legal and innovative use of a life insurance policy.  

This is how it works.  

The home owner is Bob Fanning.  Bob is offering the buyer of his $489,900 house a free life insurance policy to the value of $500,000. The insurance is on Bob’s own life, so if he dies, the policy pays out.   

The wise buyer will be morbidly hoping that Bob Fanning dies within the 10 year term of the policy because if he does, the buyer collects $500,000.  

This scheme has the full consent of Bob’s wife as it’s a separate life insurance policy established purely as a sales tactic. Just the thing in these tough times.  

Just for the record, Bob is 69 years old, and in case anyone suspects that foul play may be looming to bring a swift end to Bob’s life, the attorneys have made sure the policy is voided should Bob meet an untimely or suspicious end.  

As for the odds: Bob claims to have no health problems (although he admits to being “too short” for his weight).  Both his parents died before age 79, as did a sister. He said he’d be willing to disclose his medical records to a buyer.    

Is there no end to the use of a life insurance policy???? 

(I understand Steve Koerber of Barfoot & Thompson sourced the story… so thanks Steve.)