Further north, 32% of Auckland mothers and 29% of Wellington mothers have no life insurance cover. Not only that, but also one in 10 mothers were completely unaware of the level of life insurance cover they possess.
Of the 67% of mothers who do have life insurance cover, one third of them have less than $200,000 of cover.
Regionally, the average level of life insurance cover for mothers reveals some significant discrepancies, AMP says.
On average, Auckland mothers are insured for around $295,000 with Wellington mothers insured for almost $265,500.
Christchurch mothers draw the short straw with only $195,000 worth of life insurance cover.
“Many New Zealanders struggle when it comes to determining an adequate level of life insurance cover for their families,” AMP general manager corporate affairs Jane Anderson says. “A sum of $200,000 life cover for a mother may seem reasonable, but when you break it down, the numbers often don’t stack up.”
Anderson says there is no simple answer to determine how much cover a woman should have.
You just can’t apply a “one size fits all” approach. It comes down to the needs of each individual family.
She suggests a good starting point would be to determine the number of years left with dependent preschool and school-aged children, as well as a review of current levels of household debt. This establishes a reasonable benchmark from which to make a decision about the degree of life cover needed to safeguard a family from severe financial hardship.
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