Bought Your First Home? Here’s Why It’s Time to Reassess Your Insurance

So, you’ve just bought a home, congratulations! Whether it’s your very first step onto the property ladder or you’ve had a recent change in circumstances (like a new partner or a growing family), now is the perfect time to reassess your insurance. Buying a house is one of the biggest financial commitments you’ll ever make, so it’s important to make sure you’ve got the right protections in place should the unexpected happen. If you need advice on where the right place to start is for your situation, have a chat with our Insurance Advisor, David. He can walk you through your options and help tailor a plan that suits your needs. Get in touch with him here.

Understanding the Importance of Home Insurance:

Purchasing your first home is a huge achievement, but with this milestone comes the responsibility of ensuring your property and you and your family are protected. Insurance serves as a safety net, offering financial protection against potential risks that could jeopardise your investment. From natural disasters to accidents, having the right insurance coverage means you can handle unforeseen events with minimal financial distress. It provides peace of mind, knowing that your home, belongings, family, and financial future are safeguarded.

In New Zealand, the risk of natural disasters such as earthquakes, floods, and storms is significant. Home insurance policies typically cover these events, ensuring that if your property is damaged or destroyed, you can afford to repair or rebuild. Without insurance, the financial burden of such events could be catastrophic. Moreover, home insurance also covers other incidents like theft, vandalism, and accidental damage, providing comprehensive protection for your investment.

Although home insurance is the only insurance you must have when buying your first home, life, health, trauma, and mortgage protection insurance are all hugely important to consider. To understand the different roles of each type of cover, we’ve summarised them for you below. If you'd rather talk through insurance options with a real person, our friendly Insurance Advisor, David, is your go-to. He’s happy to chat and help you find the right cover for your situation. You can get in touch with him here.

Why Life Insurance Matters for First-Home Buyers:

If you’ve purchased your home with a partner, chances are you’ve both stretched to afford the best home possible. That’s a solid move for your financial future, taking on your new long-term investment, but what if something serious were to happen to one of you? Life insurance is designed to protect your family’s financial stability if you were to pass away or become terminally ill. Unfortunately, these situations are out of our control, but what you can control is safeguarding your partner financially so they’re not forced out on the street if the unfortunate happens. Your partner or family wouldn’t be forced to sell the house just to keep up with mortgage repayments, ensuring your loved ones can stay in the home you worked so hard to get. Even if you’re buying on your own, life insurance is a key tool in safeguarding your biggest asset.

What About Mortgage Protection?

Mortgage repayment insurance is another layer of cover that offers peace of mind. This type of policy provides a monthly payout if you’re unable to work due to illness or injury. It helps cover your mortgage and sometimes even a bit more to take care of other essential expenses like rates and utility bills, so you’re not under added financial pressure while recovering. Think of it as a short-term safety net while you get back on your feet.

Consider Trauma Insurance:

Trauma insurance offers a lump sum payout if you’re diagnosed with a major illness (like cancer, heart attack, or stroke). While it doesn’t cover death like life insurance does, it does give you financial breathing space when life throws you a serious curveball. The lump sum can be used however you need, whether that be to pay off some of the mortgage, cover medical treatment, or just take time off work to recover without stress.

Health Insurance – Worth Thinking About:

While health insurance might not be top of the list for many first-home buyers (let’s be honest, money’s probably tight right now, and that’s pretty normal as a first-home buyer, so rest assured), it’s still worth considering. Private health coverage can help speed up diagnosis and access to treatment. If it’s not affordable right now, that’s okay, but it is a great idea to have a plan to review it down the track once things settle, because you never know what may pop up. It always pays to remember that health care without insurance coverage can get very expensive, very quickly.  

So, What’s the Right Move for You?

Let’s say you and your partner have just bought your first home together. You’ve both contributed to the deposit and are sharing the mortgage repayments. Six months in, one of you is unexpectedly diagnosed with a serious illness and can’t work. Without income protection or trauma insurance, you’re suddenly down to one income, with a full mortgage to cover. That’s a lot of pressure, especially when you should be focused on recovery. Not only is it pressure on your financial position, but it could even put pressure on your relationship if you don’t have that extra layer of insurance protection to support you. With the right insurance in place, you’d receive financial support to help keep things running smoothly while you deal with the bigger picture.

Ready to Get Covered?

Buying a home is a huge milestone and a great time to take a fresh look at your insurance. I’m here to help make sense of your options and tailor a plan that fits your life and your goals. Whether it’s your first home or your forever one, let’s make sure it’s protected. Reach out to David, our Insurance & KiwiSaver Advisor, to make sure you’ve got the right protection in place.