Is protecting retirement provision a life adviser’s duty? Part One
Opinion: Early death, disease and disability is a risk that can destroy the ability to retire with more than NZ Super.
Thursday, May 14th 2026, 4:08PM
by Steve Wright
Is this a risk that life advisers (including those who are not qualified to give advice on wealth creation/retirement provision) must nevertheless consider?
I believe it is. Death, disability and poor health is a risk to retirement funding and if that’s not the domain of the life adviser, then whose is it? Why should life advisers stop protecting a client’s ability to pay the bills at age 65 or 70?
I’m not saying life advisers should be engaging in retirement planning or plan creation or commenting on the adequacy of KiwiSaver balances or contributions (unless they are competent to do so of course).
What I am saying is that life advisers should consider the negative impact of death, disease and disability on their client’s ability to retire (and that of their spouse/partner) and how they might mitigate that risk by their insurance recommendations.
Early death stops retirement provision, that’s fine if the life assured is likely to retire alone, but what of their spouse, partner or other survivors who might be dependant?
Serious accident or illness and disability may stop or significantly interrupt retirement provision, or worse, reduce existing retirement assets to supplement income loss or fund treatment.
Life insurance can help ensure clients and their survivors will still get the financial retirement they hoped for despite death, serious illness and disability.
Here are some of my thoughts on what life advisers can do, there may be others:
For death, serious illness and injury and permanent disability
- Consider the impact on retirement before they recommend reducing life, trauma and TPD cover sums insured by retirement assets/KiwiSaver.
My opinion is that retirement assets should generally be protected with insurance, not used in lieu thereof.
If sums insured are to be reduced by the value of assets/KiwiSaver, careful investigation must be made into who is entitled to these assets on death, it may not be the survivor who needs protection!
- Consider working with the client’s wealth adviser to determine whether an additional ‘retirement booster’ should be added to life, trauma and TPD cover sums insured.
A ‘retirement booster’ lump-sum can be especially useful for preserving retirement funding goals (including for a partner/spouse relying on the life assured for their retirement provision) if funding is interrupted or ceases completely (as is the case on death of the life assured).
Of course, premium affordability will typically be an issue, it almost always is, but I don’t believe that should stop a suitable recommendation. I believe affordability is generally an issue for after the recommendation is made (and the premium determined), not one that should shape the adviser’s initial recommendation.
Whatever the outcome, clients must fully understand the implications of their choices regarding the recommendation made, so that they have enough information to make informed decisions.
Life advisers who consider the risk that death, disability and serious illness may have on their clients (including spouses/partner’s) retirement provision and who recommend product options and strategies to minimise any such impacts, add significant value to their clients.
(There are recommendations that can be made for temporary disability (income protection and mortgage repayment covers) too, and I’ll deal with that in a ‘part two’ of this opinion piece.)
Steve Wright has qualifications in economics, law, tax, and financial planning. He has spent the last 20 years in sales, product, and professional development roles with insurers. He is now independent and helping advisers mitigate advice risk through training and advice coaching.
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