Looking after those important to

you in the event of your oryour partner's untimely death provides them with the financial stability to cope. It is a wise and practical choice that offers the reassurance that the future financial welfare of your loved ones will be secure.
The saying that there is more than one way to skin a cat is so true when it comes to financial protection. Many of us have Life Insurance. The issues around this though is the way it is set up and owned, does it have a specific purpose and is it calculated correctly.
What is Life Insurance used for:
- Family Protection - In New Zealand it is estimated it costs $10,000 per annum per child to raise each child. If the major income earner dies, how does this affect the income normally being generated in to that family unit. Providing to ensure the family has enough income to maintain their standard of living is essential to the health and well-being of the family unit. Life Insurance can be a lump sum payment or drip fed to families.
- Debt Protection - Major debt like House Mortgage is generally well covered from an insurance point of view. Protecting people's biggest asset and providing a roof over loved ones heads is a vital consideration. Other debts such as business debts, personal loans, and other capital payments owned to individuals can be missed out though in the calculation and should be considered essential as well. Separating these purposes out is also vital especially when calculating how these premiums are to be paid, who pays and should they become a tax deductible expense.
- Trust Ownership - Do you have a trust? Who should own your life insurance policies then. Should they be cross owned, owned individually or owned by the trustee's of the trust.
