Annual insurance policy review checklist for NZ

Start by collecting the latest policy schedule, policy wording, renewal or anniversary notice, and any letters or emails that changed the terms. Then compare those records with the people, income, debts, assets and business arrangements you have now.

FMA and Sorted guidance both recommend reviewing insurance regularly, especially when circumstances change. A review can end with a decision to keep everything as it is. The useful outcome is a clear record of what was checked, what needs an answer and what, if anything, should be discussed before the next renewal or anniversary.

FMA guidance points to events such as marriage, buying a home, having children, changing occupation and paying off a mortgage as reasons to revisit cover. Separation, retirement, a move, a large debt change, a new dependant or a change in workplace benefits can also alter the questions worth asking.

For a small business, compare the policy records with current turnover, payroll, premises, equipment, stock, vehicles, contracts, ownership and key people. A change does not prove that more, less or different cover is needed. It tells you which assumptions from the previous review may no longer be reliable.

The Financial Services Council describes the policy wording and schedule as the formal insurance contract. The schedule holds the details specific to you, while the wording explains what is and is not covered, when a claim may be paid, and the responsibilities of the insurer and policy owner.

Read the amount of cover beside the definition it relates to. Check waiting periods, payment periods, excesses, exclusions, premium loadings, indexation, renewal terms and any endorsement that changes the standard wording. For personal insurance, also check who owns the policy and who would receive any payment. For business cover, check that the named entities and insured activities still match the current operation.

A premium change is an obvious reason to open the documents, but price is only one part of the comparison. Sorted warns that policies with different prices may also provide different cover. The excess, definitions, exclusions, payment period, special terms and claim requirements can change what the policy may do.

If the premium is difficult to maintain, ask what options exist and what each option changes. FMA guidance recommends understanding the effect of a premium holiday, suspension, higher excess, reduced cover or other adjustment, and getting important explanations in writing. Do not assume a lower premium is a like-for-like result.

A review is not an instruction to switch insurers. FMA guidance says a replacement policy can have different cover, a new qualifying period, different premiums or exclusions for health conditions that arose after the original policy began. Those differences may matter more than the initial price.

If replacement is being considered, compare the old and proposed wording side by side. Ask what improves, what is reduced, which exclusions or waiting periods are new, whether underwriting is required, and when the replacement would actually start. The FMA advises keeping the old policy in force until the new policy is in force, so there is no accidental gap while a decision is being completed.

Keep a one-page summary with the policies. It should show the review date, documents checked, important changes, questions, written answers and any agreed next action. Tell the appropriate family member, business partner or record keeper where the current documents can be found, without sharing sensitive health or financial information more widely than necessary.

This checklist is general information, not personal financial advice. A one-to-one review can consider your circumstances, budget, existing cover and policy wording before any recommendation is made. You can bring the inventory to an insurance conversation and use it to keep the discussion focused on facts rather than memory.