A life insurance policy is a contractual agreement between an insurance company and a policyholder, who is usually the person whose life is insured.
The policy agrees that in the event of the insured person’s death, or diagnosis with a terminal illness, the insured amount will be paid out to the beneficiary listed on the policy.
It’s important to understand what a life insurance policy is, and how it works, before choosing your insurance provider, policy type and level of cover. This page will cover key information on what a policy is and what to look out for, so that you can select the best policy for you and your loved ones.
A life insurance policy documents an agreed upon sum which is to be paid out to the person’s estate via their will in the event of the insured person’s death. The level of cover is selected by the policyholder. The policyholder is charged a regular amount, which we call a premium. This is based on the level of cover selected, the age of the insured person and their medical history. Premiums are generally paid in fortnightly or monthly instalments, but some people choose to pay annually or biannually.
A life insurance policy is designed to give the insured person peace of mind that if they were to die unexpectedly, their loved ones would be taken care of financially. The cost of living is expensive, and with mortgages, other debts and dependents to think about, it’s important to have a plan in place.
Understanding your life insurance policy can be a bit overwhelming. Below are some of the key policy terms that you might come across.
If in doubt, we are only a phone call away. We’d be more than happy to answer any questions you might have about your life policy.
If the insured person is diagnosed with a terminal illness, Chubb Life will pay their Life Cover Amount up to $500,000.
If the sum of the Terminal Illness Benefit is equal to the insured sum on the policy, the policy will conclude and no further payouts will be made.
In cases where the Terminal Illness Benefit is less than the insured sum on the policy, the amount paid will be deducted from the total insured amount and premiums will be adjusted to reflect this. The remaining balance is then payable when the insured person passes away.
For further information on our Life Insurance Policies, check out our Chubb Life Life & Living Policy wording
Hopefully we have cleared up some of your questions! We know reading a Life Insurance Policy isn’t most people’s idea of fun, so if you need further clarification on anything, the Chubb Life team would be happy to chat.
Having right life insurance in place can give you peace of mind from knowing you and your loved ones are protected.
Your insurance is underwritten by Chubb Life Insurance New Zealand Limited (Chubb Life). Chubb Life has an A (Excellent) financial strength rating given by A.M. Best Company Inc. A summary of the rating scale is: A++, A+ Superior | A, A- Excellent | B++, B+ Good | B, B- Fair | C++, C+ Marginal | C, C- Weak | D Poor | E Under Regulatory Supervision | F In Liquidation | S Suspended. For the full rating scale and more rating information visit www.ambest.com/ratings/guide.pdf