Redundancy/Bankruptcy Cover – an optional extra benefit to Term Cover with Income Cover

Redundancy/Bankruptcy Cover is an optional extra benefit to Term Cover. It can pay you a monthly benefit for up to six months if you are made involuntarily redundant or bankrupt. This benefit is only available with Income Cover.

Benefits

You can apply to add Redundancy/Bankruptcy to your Term Cover Life Insurance at the same time you apply for Income Cover.

  • The benefit is tied to Income Cover, so the benefit amount is the same
  • Choose a benefit amount between $1,000 and $4,000 (except if you are working less than 25 hours per week)
  • The benefit payment is usually used to cover all your major expenses such as your home loan - but how you choose to spend it is up to you
  • Payments can start just 30 days after you are made redundant or declared bankrupt
  • While on claim, you don’t pay any premiums (up to a maximum of $300 per month) for your Term Cover Life Insurance
  • Premiums are combined with your Term Cover premium
  • Redundancy/Bankruptcy Cover can be renewed up to age 65
How does it work?

If you are made involuntarily redundant or bankrupt, you could receive a monthly payment for up to six months.

To apply for the Redundancy/Bankruptcy Cover option on your Term Cover Life Insurance, you need to be between 18 and 59 years old and be a New Zealand resident. The benefit amount will be the same as your Income Cover option and the benefit paid can be no more than 40% of your gross income at the time you apply for cover.

What isn’t covered?

The first 30 days of any claim are not covered. No benefit will be paid if you were working less than 25 hours per week when you stopped work.

The policy won’t cover:

  • any redundancy or bankruptcy that you knew about at the start of the policy
  • any redundancy or bankruptcy that occurs or you become aware of in the first six months of the policy.

For redundancy specifically, the policy won’t pay out if:

  • you are not paid by salary or wages
  • you are self-employed, on a fixed term contract or in seasonal, temporary or casual work
  • you are a director of the business or employed by a direct member of the family
  • you have not satisfied us that you are actively seeking full time employment.

For bankruptcy specifically, the policy won't pay out if:

  • you are not self-employed
  • you voluntarily declare bankruptcy
  • you knew at the start of the policy that it was likely or possible that bankruptcy notice or proceedings would be issued against you.