Income Protection and Life Insurance for New NZ Business Owners
Starting a new NZ company changes your insurance needs significantly. This guide explains income protection, life insurance, and key-person cover for new business owners and company directors.
Why New Company Directors Need to Review Their Insurance
When you move from employment to running your own company, the income protection you relied on through an employer often disappears. If you are injured or become seriously ill, there is no employer covering sick leave. Personal income protection insurance is the first policy every new company director should consider.
Types of Insurance Most Important for New Company Directors
Income Protection Insurance
Replaces a portion of your income (typically 75%) if you are unable to work due to illness or injury. The waiting period and benefit period determine how much your premiums cost. New business owners with personal debt or a mortgage should prioritise this cover.
Life Insurance
If your company has a bank loan in your personal name or a business mortgage, life insurance ensures the business can continue or be wound up cleanly if you pass away. Sole-director companies are especially vulnerable.
Key Person Insurance
If your business depends on a single person whose death or disability would significantly affect revenue, key person insurance compensates the company for the loss. This is especially relevant for professional service firms.
Business Interruption Insurance
Covers lost revenue if your business is forced to close temporarily due to events like fire, flooding, or other insured events. Usually combined with commercial property or public liability cover.
When to Talk to a Financial Adviser
Insurance needs are personal. A licensed financial adviser can assess your income, debts, family situation, and business structure to recommend the right cover. The best time to review is within the first 30 days of company registration, before your business expenses grow.
Connect with a Financial Adviser or Insurance Specialist
If you have just incorporated a company and need personal or business insurance advice, use the FreshFirms Connect form to be introduced to a specialist in your region. We match new company directors with licensed advisers and brokers.