5 Myths About Insurance

By Lighthouse | August 1, 2022 | 5 Min read

Myth #1 “I don’t need cover because I’m single and I don’t have any dependents.”

We actually get this quite often when speaking with mortgage clients. Truth is, when you first purchase a home, you usually have to take on quite a bit of debt. Your income is the only source of funds to reduce that debt and therefore, it’s worth protecting. The alternative would be to default on the mortgage and sell the home or rely on the generosity of friends and family to pay off the debt.

Myth #2 “The government will take care of me.”

People often don’t understand the limitations of ACC. ACC will cover you if you have had a sudden accident or injury but it will not cover you if you are suffering from an illness. This means if you have a heart attack, cancer or depression, you won’t be covered. Not only will you need to cover the medical costs but in the event that you can’t work due to your illness, you won’t receive any benefits either. With over 5 million eligible Kiwis for ACC, the wait times can be extremely long to get access to care. Furthermore, access to care is never guaranteed, it only takes a quick search on the NZ Herald to read some of the horror stories of Kiwi’s being rejected for life-saving treatment from ACC. If you want to make sure that you are taken care of, protect yourself with insurance.

Myth #3 “Life insurance is expensive.”

Of all of the personal insurance products you can purchase, Life insurance is actually the least expensive.


For a 30 year old healthy (non-smoker) male for $500,000 of life cover – it will cost $8.98 weekly


For a 30 year old healthy (non-smoker) female for $500,000 of life cover – it will cost $6.06 weekly

It is generally put in place when people have a large debt they want to clear if they were to pass away prematurely.

Myth #4 “Only breadwinners need life insurance.”

If you’re a couple and have children, the caregiver often takes on a full schedule of un-paid responsibilities. If that caregiver was to pass, the full weight of those responsibilities falls back on to the main household earner. Aside from the emotional anguish, this can cause a large amount of pressure on the single parent and income earner. It pays to have insurance to help alleviate the financial pressure so the single parent can focus on looking after the family.

Myth #5 “I’m better off being self insured.”

The average cost of common surgery in NZ is around $20,000, this doesn’t include diagnosis, post surgery medication and rehab. So how do Kiwi’s stack up with self insuring that amount? 4 in 10 Kiwi’s have less than $1,000 saved for emergencies. The other consideration when self insuring is the public list waiting times when needing medical treatment. The average wait time for medical treatment is 100 days longer on a public list than a private one. With the shortage of doctors, nurses and medical infrastructure in NZ, those wait times are only getting worse. Having health insurance ensures you get the medical treatment when and where you need it.

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