Cheapest Insurance in NZ
- May 18, 2022
We’ve (literally) done thousands of insurance quotes to discover where you can find the cheapest insurance in NZ. Be warned however, that there is no one simple answer. The brand that has the cheapest car insurance doesn’t necessarily have the cheapest home, contents, pet, life, or income insurance.
Introduction to Cheap Insurance
Is cheap insurance worth it? Our simple answer is: no.
What you should be looking for the best value insurance.
This means insurance that is affordable, while also providing you with adequate cover and a good customer experience. There are cheap insurance companies out there that will happily sell you a bargain-priced policy, but you’ll soon find out why it was so cheap (hint: when you call to make a claim and are on hold for 45 minutes, before discovering that you aren’t covered for that type of incident).
We’ve written this guide to find the cheapest insurance in New Zealand so you don’t have to get quotes from dozens of providers as we did. We only compared good insurance products, from brands you can trust.
What's in our cheap insurance guide?
Why is some insurance cheap?
Lower company profits
Put simply, some companies are making exceptionally large profits. For example the parent company of State and AMI (IAG) made an insurance profit of $305 million in the 2021 financial year. Clearly, they are taking in a lot more in customer payments than they are paying out in claims.
Other insurance companies in NZ make smaller profits, such as the likes of MAS Insurance or Cove Insurance. These are smaller companies that are more focused on growing their customer base than generating eye-watering profits – so you’ll often find cheaper premiums.
Less staff
Younger insurance companies are building with a digital-first approach. This means they don’t need 200 call centre staff on $65,000 salaries to help their customers buy their policies and process claims.
With a lower cost to serve customers, these younger companies can pass on the savings with cheaper insurance.
Note: It’s not only less staff that can help lower an insurance company’s expenses. You’ll see most insurance companies in NZ have expensive buildings in prime Auckland locations, with their signage proudly displayed upon them. This also increases the company’s cost, which ultimately has to be passed on to the customer. Companies like FMG Insurance are breaking this mould with their head office being based in Palmerston North, and Cove Insurance has all staff work from home full-time to avoid office costs altogether.
Less coverage
The saying goes – “you get what you pay for, and that also applied to insurance. The weaker the actual insurance policy, the cheaper the insurance (in most cases).
The most obvious way to identify “less coverage” is through the sum insured.
The less obvious way is to read through the policy wording to see exactly what each insurance company excludes…which pretty much no one ever does.
Higher excesses, or additional excesses
You can nearly always get the cheapest insurance by choosing the policy that has the highest excess.
Put simply, the excess is the amount you need to pay when you make a claim.
An example could be car insurance: You can often choose four or so difference excesses at each insurance company. These range from about $200 up to $1000 or more. If you choose the $200 excess, your premium might be $68 per month. But if you choose the $1,000 excess, then your premium could be as low as $40 per month.
This is because with the higher excess the insurance company doesn’t need to pay all those little nitty-gritty claims. If you have a $1000 excess, you aren’t going to claim for an $800 scratch – since it’s simply cheaper to pay the panel beater directly. Because of this, the insurer doesn’t need to charge high premiums, so the end result is cheaper insurance.
Cheapest Car Insurance Quotes
In the scenario below, we found that Cove offered the cheapest car insurance. We compared comprehensive car insurance policies from a range of providers so we could find the cheapest comprehensive car insurance. You’ll be able to find cheaper third party policies from these providers and others – but we decided to limit this research to comprehensive car policies only.
- Car: Mazda
- Type: Hatchback
- Driver: 32yo Male
- License: Full
- Location: Auckland
Get your own quotes as these quotes are only a snapshot in time. Car insurance prices can change frequently, so you might find different prices for these scenarios if re-done today.
Notes about cheap car insurance
There are a couple really easy way to get cheap car insurance.
- Increase your excess
- Lower your cars value
- Choose a third party policy rather than a comprehensive policy
- Pay off any finance on the car
- Get your full licence
- Don’t collect speeding tickets
- Don’t modify your car
- Don’t have any DUI convictions
- Don’t buy a highly powerful car
- Don’t buy a European car
- Don’t buy a unique car
Easy right?
Although not everyone wants to be driving around in a Mazda Demio. (Fun fact: The Demio is the most stolen car in NZ)
Cheapest Pet Insurance Quotes
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- Pet: Dog
- Breed: Labrador
- Gender: Male
- Desexed: Yes
Get your own quotes as these quotes are only a snapshot in time. Car insurance prices can change frequently, so you might find different prices for these scenarios if re-done today.
Notes about cheap pet insurance
Pet
Cheapest House Insurance Quotes
Initio was the cheapest house insurance brand we could find in this scenario. They are a smaller brand, but backed by NZI, which in tern is backed by IAG, which also owns AMI and State. Yeah, it’s confusing!
- Location: Hamilton
- Value: $645,000
- Type: Weatherboard
- Special features: Nonw
Get your own quotes as these quotes are only a snapshot in time. House insurance prices can change frequently, so you might find different prices for these scenarios if re-done today.
Notes about cheap house insurance
Do you really want cheap house insurance?!
You house is likely your biggest assets, so surely you want it to be well protected should something go wrong. We feel there are some things that you can afford to be cheap with. Things like cellphone insurance, or maybe some contents insurance. But definitely not home insurance.
Picture this: You are driving home from work one day and you see smoke in the distance,coming from the direction of your house, and you start to panic a little. As you turn the corner into your street, you see the neighbours out on the road holding up their photos getting some spectacular footage for Instagram as your home goes up in flames.
Your first thought is obviously… “Bugger”.
But what do you want your second thought to be?
“Lucky I’ve got an amazing home insurance policy that will cover the full cost of rebuilding this”.
Or…
“I really hope that cheap policy that gave me a $50 Prezzy Card will at least let me rebuild a tiny home to live in”.
Yeah, you want the rock-solid policy and not the Prezzy Card.
So when it comes it home insurance, please don’t just go shopping for the cheapest home insurance you can find.
Accurately estimate the rebuild value of your home, and compare all the big-name brands. If you have a complex situation, ask a broker for a bit of advice.
Cheapest Contents Insurance Quotes
In the scenario below, we found that Cove offered the cheapest car insurance. We compared comprehensive car insurance policies from a range of providers so we could find the cheapest comprehensive car insurance. You’ll be able to find cheaper third party policies from these providers and others – but we decided to limit this research to comprehensive car policies only.
- Value: $85,000 worth of contents
Get your own quotes as these quotes are only a snapshot in time. Car insurance prices can change frequently, so you might find different prices for these scenarios if re-done today.
Notes about cheap contents insurance
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