Older lives still need cover

The standard model of insurance is one of declining needs as lives get older. It assumes a kind of fairy-tale financial life in which assets rise and debts fall as a ‘typical’ working life continues progressing towards the anticipated gold watch arriving at age 65.

Increasingly we are learning that this isn’t realistic. Life is complicated, and messy, and textbook renditions of life that work on average are the very opposite of the personalised advice approach that clients are looking for.

Here are four key trends which mean that our formulaic ideas about older lives may be out of date – and why they may in fact need that life cover after all.

Longer lives – because people are living longer many are working longer. That may be a reflection of the steeper fall from a full-time working income to New Zealand superannuation plus whatever has been saved, or it may just be out of choice. But if 65 was the equivalent of 80 at the turn of the century, then another way to look at it is that 65 is the equivalent of 50 in today. If people don’t feel that they are getting ready for retirement at age 55 then they will make decisions to grow, build, and do new things – and insurance is often a valuable part of that process.