Cheeky Hippo Financial Advisers

Let’s be honest, we all have expectations and aspirations about

our future retirement - living la vida loca - filled with fun travels and adventures, the ultimate mortgage free home, topped with financial independence and freedom of choices.

We don’t ask for much. 

We just want to enjoy – and more importantly, maintain - the lifestyle that we worked so hard for our whole life.

If you’re like many Kiwis, your KiwiSaver might just be a hazy concept chugging away in the background, rather than something you give much thought to. However, it’s worth taking a moment to make sure you’re in the right KiwiSaver fund with the right provider for you, as this will play a big part of your future wealth. Not all KiwiSaver funds are created equal. Two apparently similar growth funds, for example, might be growing at different rates. That could be due to investing choices made by the provider’s staff. Or it could be due to layers and layers of hidden fees.

There are not many investments that are worth more immediately, than you have paid in. KiwiSaver is, because of the Government tax credits and employer contributions. But many Kiwis are missing out on potentially thousands of dollars because they don’t know how to optimise their KiwiSaver.

We assess your risk tolerance, investment timeline and objectives, optimising your KiwiSaver from a savings fund to a powerful investment strategy. Let us help you take your investment from average to Yeah Baby!

If a child, a spouse, a life partner, or a parent depends on you

and your income, you need life insurance.

Suze Orman

Personal insurance can help you protect your family should you pass away, become ill or injured. It ensures that everything you and your family have worked for, is kept safe should anything happen to you.

We all insure our homes, our cars, even our mobile phones and laptops. But your greatest asset is YOU, and your ability to earn an income. Yet, a lot of people don’t think about insuring themselves. What would happen to your family if you were no longer there to provide for them, or if you no longer had the ability to provide for them?

HOW DOES A DISABILITY, ILLNESS OR ACCIDENT RELATE TO INSURANCE?

Life cover

As financial advisers, we see the importance of life insurance time and again. While nobody likes to think about the worst-case scenario, eternal life is still something found only in sci-fi films and at this stage at least, passing away is still inevitable. Life insurance can provide peace of mind knowing that your loved ones will be taken care of in the event of your unexpected passing.

The benefits of life insurance are many, but the most important outcome is that your family is financially secure if you’re no longer around to provide for them. 

Life insurance can cover the cost of funerals, debts and provide an income stream for your family going forward. The right policy means your family may not have to worry about the mortgage, school fees, or the family income and can maintain their current standard of living.

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Total and Permanent Disability Cover

How would you cope with becoming totally and permanently disabled? It could happen because of a medical event, like a stroke, or it could be the result of a vehicle or sporting accident. While it’s tempting to think this kind of personal disaster will never happen to you, total disability becomes the new reality for a number of New Zealanders every year.

Apart from the emotional and physical adjustments, the financial repercussions of becoming totally and permanently disabled can be huge. You might think “but WINZ pays disabled people if they can’t work”, however the ‘supported living benefit’ is (at most) around $700 to $800 a fortnight before tax. If you have a mortgage and kids, that level of income won’t go very far.

Getting Total and Permanent Disability (TPD) cover is a way to offset the risk of becoming totally and permanently disabled, and unable to work in your usual or any profession ever again. 

TPD cover is designed to provide a lump sum payment if an accident or sickness means you’re unable to work again. This could refer to work in your usual job or any job, depending on the policy you have. The disability must meet the policy’s definition of ‘total and permanent’ as outlined in the insurance contract. TPD cover premiums are generally lower than trauma cover premiums, because the eligibility criteria for a TPD claim are typically more stringent.

Specific terms and conditions of Total and Permanent Disability cover vary between insurance providers in New Zealand, so it’s always a good idea to review the policy documents carefully.

There are a few areas that demand extra careful checking:

1. Being covered for ‘own occupation’ means the insurer will pay a claim if you can’t work in the specific occupation you were involved in immediately prior to incapacitation. It accepts that you might be able to return to work in a different occupation.
2. Being covered for ‘any occupation’ means the insurer will only pay out if you can’t work in any type of paid work, which narrows the chance of a successful claim.

Trauma/Critical Illness Cover

This cover is about helping you with survival. Kiwis are suffering increasing occurrences of cancer and high levels of heart disease and strokes. With ongoing advances in medical science, however, you have a higher chance of surviving a severe medical condition.

You do not have to be unable to work to qualify for a payment. It ensures that you can cope with the effects that a critical illness diagnosis would have on your lifestyle, family, and work.

Here are some examples of how a Trauma Cover lump sum has helped people in the past:

1. Assisting with medical costs associated with recovery
2. Seeking alternative treatment
3. Paying for drugs that are not government funded
4. Paying off the mortgage
5. Subsidising lost income
6. Paying for alterations, rehabilitation, and home help

Income/Mortgage Protection Cover

Your ability to earn an income is potentially the most valuable thing you have. Without it, you’d be relying on savings, selling assets, and the kindness of family and friends. That’s why income protection cover is relevant to every New Zealander with a job.

The health risks that can quickly derail your income are long-term sickness and recovery from a serious accident. These are things that you read about every day in the newspaper. Income and Mortgage Repayment Protection cover helps to balance this risk by providing a monthly income when you can’t work.

Income protection cover and mortgage repayment cover are quite similar. The main difference is that income protection cover pays you a percentage of your income (e.g. up to 75%) and will offset any other income when you are on claim, while mortgage repayment cover pays either a percentage of your income (e.g. up to 45%) or a percentage of your mortgage repayments (e.g. up to 115%) and have no offsets, ie: it will pay on top of any other income, like ACC, when you are on claim.

Both insurances let you use the money you get from a claim for anything like rent, mortgage repayments, rates, utilities, food and other living expenses. Also, both insurances require you to choose a waiting period (the time you have to wait before payments can start) and a payment term (the length of time payments can be paid).

Four good reasons you should consider protecting your income:

1. It ensures financial stability when ongoing illness or injury recovery leaves you unable to work. By replacing a percentage of your lost income, it lets you meet your financial obligations, such as mortgage payments, bills and daily expenses, without exhausting your savings or relying on others for support. Some policies also provide protection against redundancy.
2. It allows you to maintain your current standard of living, which helps you avoid a significant lifestyle downgrade.
3. It could offer long-term financial security. It can provide coverage until retirement age or even longer, depending on the policy you choose. This extensive coverage ensures you’re protected against long-term disabilities that could significantly impact your ability to earn an income.
4. It complements other insurances you may have. While health insurance covers medical expenses and life cover provides financial support to your loved ones if you die, income protection insurance focuses solely on replacing lost income due to sickness or injury.

Private Medical Insurance Cover

In New Zealand we are lucky to have an excellent health system. In the case of an accident, ACC can help cover the costs of our treatment and even compensate us for lost wages. If we fall ill, we can rely on the care of hospitals and other medical providers with the majority of the cost being covered by our government-funded healthcare system.

As a result, many people decide to forego the expense of personal health insurance and put their faith in the public system.

We’re all aware that New Zealand’s public health system is often under strain. Its problems confront us regularly in news stories, as we read about staff shortages and waiting lists for surgeries. These challenges have been even greater during the Covid years. So what can you do to protect yourself from the vulnerabilities of local health boards and get the treatment or surgery you need?

It is also very important to note that you can only be treated in the public health system with drugs (medicine) that is funded by the Pharmac - the government agency that decides which medicines and related products are funded in New Zealand. With the right private medical insurance, you can have access to more treatments (often very expensive) that could have a better outcome for your diagnosis.

The number one reason for getting health insurance in New Zealand is having choices about your own health. When you’re at the mercy of the public health system, you have no power over when you get the surgery, diagnostic screening or treatment you need, where it happens and who will do the procedure. When you have health insurance, you get to decide all these things. However, not all health insurance is created equal. That’s why working with Cheeky Hippo Financial Advisers is a smart thing to do and can help you to make a selection based on your needs and budget.

To Summarise

Having insurance is a great way to ensure your family are protected, having the RIGHT insurance in place is how you secure your family’s future. Talk to us to ensure you have the right level of cover and the right policy for you. 

It is very important that you understand that the information above is general in nature and does not consider your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser.

A good and resilient business will have plans in place for many eventualities. The death or critical illness of an owner, business partner, or key person is something that nobody can control—but you can have arrangements that will give your company the best chance at surviving such a tragic event.

Life insurance is relevant and important not only in a personal setting but also in a business context. There are different policy types available that offer peace of mind to business owners in varied situations. Finding the right cover to suit your unique

situation can be tricky but there is something available to suit nearly every business, whether you are a limited company, partnership or sole trader — it’s just a matter of finding the right combination.

Here’s a rundown of the cover to look for when protecting your business.

Shareholder/Ownership Buyout Cover

This cover is intended to allow shareholders and business partners to continue operations should one of them pass away or become incapacitated. In conjunction with a written agreement, it can allow the remaining partners and shareholders to buy out the shares and keep things running as they intended, while ensuring that the deceased partner or shareholder’s family or heirs receive a fair price.

Keeping a business running efficiently and effectively is a desired outcome that can protect jobs and the livelihoods of those who have invested time and money into the company. This insurance is a crucial aspect of planning for the future. It should be put in place alongside a legal arrangement that sets out the intentions of the partners for what should happen in the unfortunate event of a death or serious illness or injury.

Benefits for the remaining shareholder(s):

✓ No need to raise capital or borrow funds at an inopportune moment to purchase the shares

✓ Won’t find yourself in business with the deceased shareholder’s beneficiaries

✓ Prevents a forced sale of the business to pay out the estate

✓ Business can return to normal as quickly as possible

Benefits for the estate or family members:

✓ Agreement in place to ensure a fair buy-out price and a quick, easy process

✓ A cash payment to relieve the financial stress of losing a key breadwinner

Do you need it?

Yes, if you wouldn’t be able to afford to ‘buy out’ your partner’s shares in the event of death or disability, and if you want to have control over who you end up in business with. Otherwise you could potentially be forced to welcome a beneficiary of the shareholder’s estate (wife or child) into your business who most likely would not have the necessary skills, knowledge or experience needed to be an asset to your or your business.

Key Person Cover

This type of policy recognises that there are often people that are crucial to the wellbeing of a company due to their unique expertise, knowledge, or experience. If you’re a business owner, partner, or shareholder, you may be able to think of one or two key people who are almost irreplaceable. There may be more than one and may include you as the owner, and that’s OK—you can take out policies for multiple key people. Many small and medium-sized businesses have one or two key people who are integral to the running of the business.

Loss of Revenue Cover, Business continuity, Key Person protection, Locum Cover or Business Overheads Cover. Call it what you will, if a main income earner or key individual is incapacitated due to illness or injury, your business will need funds to ensure the bills are paid and the business remains viable.

Key person insurance has the business as a beneficiary and will pay out a lump sum or monthly instalments after the loss of the key person. This can keep the business afloat by covering recruitment, training, loss of profit, contract penalties, and anything else necessary. These funds can be used to source and pay for a replacement person or locum, to cover fixed costs and overheads, or to provide a cash injection to keep the business cash flow positive and solvent.

Do you need it?

Yes, if you are like many businesses who struggle to survive the interim period after the loss of a pivotal employee. Particularly if that person has a lot of specific institutional knowledge and experience, or the business operates in a market with a talent shortage. 

Ask yourself the following:

✓ Can the business function without you or a key person? How well?

✓ What percentage of the gross profit is attributable to you or your key person?

✓ Will money make a difference in keeping the business running in your (or their) absence? This could be by covering overheads during a period of reduced profitability or by paying someone else to do your (their) role or a supporting role for a time.

Debt Protection Cover

Debt Protection helps mitigate the risk of personal assets, such as your family home, being put at financial jeopardy if your company were unable to meet it's financial obligations - which usually comes as a result of the loss of a shareholder. The remaining business owners would receive a payout which can be used to repay debt and reduce the risk of company or personal insolvency. 

Debt protection ensures the company’s debts are cleared if the unexpected happens. This leaves the business as an unencumbered asset, which is more easily sold or managed by the estate or inheritors. This is particularly vital if any business loans have been personally guaranteed or personal assets have been used as security.

Do you need it?

Yes, business loans are often secured by the personal guarantees of the shareholders and their families. If you were to die or suffer a serious illness, the cash flow required to service any business loan may be affected. If creditors are not prepared to roll the loan over and instead, they call it in, your personal assets and those of your family may have to be sold to repay it. 

ACC Cover Plus Extra

Not many business owners are aware that there is an ACC benefit designed specifically for the self-employed. While all earners in New Zealand, including the self-employed, are covered for accidents through ACC, there is a dedicated alternative available for sole traders, contractors, those in business partnerships and non-PAYE shareholder employees. 

CoverPlus Extra allows for flexibility and tailoring of the ACC package to suit your individual business circumstances. There are a number of significant advantages attached to CoverPlus Extra that make it more beneficial than the default product, CoverPlus. These include not having to prove either loss or income at the time of claim, and being able to receive the full benefit even if the business continues to generate income.

Please note, advice and assistance with ACC Levy structuring is only provided to clients who work with Cheeky Hippo Financial Advisers for their personal or business insurance.

It is very important that you understand that the information above is general in nature and does not consider your unique business situation. You should consider whether the information is appropriate to your business’ needs, and where appropriate, seek professional advice from a financial adviser.

Employee Benefits

Employee benefits can mean something different to everyone involved. And once you’ve found great employees, how do you keep them from jumping ship? One way is by offering great staff benefits. Great employee benefits programs can do wonders in retaining great people and attracting other highly capable talented professionals. Such a well-developed employee benefits program can encourage your employees to refer the best talent from their own professional networks. 

Employee insurance benefits, also known as perks, loyalty or fringe benefits, are provided to employees over and above salaries and wages. These employee benefit packages may include overtime, various insurance products, profit sharing and

 additional Kiwisaver contributions, to name just a few.

Employers generally pay discounted rates on group insurance policies and staff can get cover without having to complete any paperwork and pre-existing health conditions are often covered (conditions apply).

Key benefits of Employee Benefit programmes

1. Offers employees additional benefits not general available to retail clients.
2. Builds a culture where your employees feel recognised and valued.
3. Reduce your staff turnover and recruitment costs.
4. Enable you to attract top talent when you need to recruit.
5. Managed by specialist advisers who are on call for your team no matter what the enquiry with across all the New Zealand’s leading providers.

Employer funded insurance policies employers are likely to offer are:

1. Medical/Health Insurance
2. Life and Trauma
3. Total and Permanent Disablement
4. Income Protection
5. KiwiSaver

Have you ever looked at the directions to put together a flat pack piece of furniture? What a nightmare! So, what we do is, we put together families' and business owners' “financial flat packs”.

We take the gibberish and complication out of your financial and insurance needs and working as a team, we will show you how to put a financial flat pack together quickly and efficiently, that will give you financial certainty for years to come in just 4 easy steps.

Step 1: 

Getting to know you and doing a financial health check.

(Not as bad as it sounds, we promise)

A better understanding of what is important to you, your current circumstances and where you want to be financially in the future, (or worse, when life throws you a curve ball) will enable us to put together a comprehensive, tailormade risk plan.

 Step 2: 

Great! What now?

Based on your needs from our first meeting, we will analyse your risks and shortfalls and together, we will determine areas where you can avoid, reduce or in some instances even retain the risk. But more importantly, we will put together an insurance plan that will transfer the balance of the risk. 

 Step 3: 

And….. action!

It is great to have a plan, but, a plan is just a piece of paper if we don’t implement it. Balancing the probability of risk as well as affordability, we will help to guide you to optimal piece of mind. 

Step 4: 

With you all the way

The only thing in life that is constant is change. Now that we know that your life, circumstances and needs will change, we are saying, so will your risk, and, should your insurance. Up or down. We are here for the long run, making sure that your financial risk plan is always fit for purpose.

Cheeky Hippo Financial Advisers Limited (FSP721511) holds a licence issued by the Financial Markets Authority to provide financial advice.