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Loan Insurance Coverage Options

Understand exactly what your loan protection insurance covers and how it protects you and your family in New Zealand.

Coverage varies by policy. The specific benefits included depend on your chosen insurer and policy type. Get a personalized quote to see exact coverage details.

Top-Rated NZ Providers

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#1AIA New Zealand
4.5

Homeowners wanting comprehensive mortgage protection with wellness benefits

Mortgage repaymentIncome protection
Get Quote at AIA
Partners LifeNZ
4.5

Those wanting flexible waiting periods and strong claims support

Mortgage repaymentTotal disability
Get Quote at Partners
Fidelity LifeNZ
4.3

Those who value NZ-owned insurers with generous benefit limits

Mortgage repaymentRent cover
Get Quote at Fidelity
All providers are licensed NZ insurers

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Common Coverage Types

Most loan insurance policies include some or all of these coverage options

Death Cover

Remaining loan balance cleared if insured person passes away

Terminal Illness

Coverage triggered by diagnosis of terminal condition

Total Disablement

Benefits if you become unable to work due to disability

Redundancy

Loan repayments covered if you lose your job

Temporary Disability

Income protection during temporary illness or injury recovery

Business Interruption

Coverage for self-employed during business closure

What's Typically Covered

✓
Loan repayment protection
✓
Involuntary unemployment coverage
✓
Accidental injury protection
✓
Illness and disability benefits
✓
Death benefit (varies by policy)
✓
Optional terminal illness rider

Common Exclusions

✕
Pre-existing conditions (unless waived)
✕
Self-inflicted injury
✕
Voluntary redundancy
✕
Substance abuse related claims
✕
Claims within waiting period
✕
High-risk occupations (unless specified)

How Much Cover Do You Need?

Determining the right coverage level depends on several factors

1

Assess Your Loan Amount

Your coverage should match your outstanding loan balance and monthly repayments.

2

Consider Your Income

Coverage limits are typically capped at your monthly income for sustainability.

3

Evaluate Your Risk

Job security, health status, and savings determine your coverage needs.

4

Compare Waiting Periods

Shorter waiting periods cost more but provide faster benefit payment.

Pro Tip

A good rule of thumb is to ensure your coverage matches at least 12-24 months of your outstanding loan balance. This provides sufficient protection during unemployment or recovery periods while remaining affordable.

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Find the Right Coverage for You

Compare coverage options from leading NZ insurers and get personalized recommendations based on your situation.

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