How New Zealanders are cutting the cost of their insurances
New Zealand homeowners are increasingly opting for higher insurance excesses to mitigate the impact of rising premium costs. Insurers report that this trend is a direct response to cost-of-living pressures, allowing policyholders to lower their annual premiums by accepting more financial risk in the event of a claim.
Why it matters
It highlights how inflation is forcing consumers to alter their risk management strategies, potentially leaving them more vulnerable to out-of-pocket expenses during emergencies.
Insurance costs have been a major pain point for many households in recent years, but data from insurers shows many of us are finding solutions.
It was reported mid last year that insurance had the largest increase of any item in the consumer price index since 2000, up 916 percent.
Insurance experts told RNZ that some health insurance policies lifted 50 percent last year.
But while there are signs that premium rises may be moderating, some policyholders are finding other ways to reduce their costs.
Generally, if your insurance policy has a higher excess, you may be able to pay lower premiums.
Excess is the amount that a policy-holder pays when they make a claim, before the insurer chips in the rest.
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