Your insurance needs should reduce as you get older


I'm a HUGE advocate for insurance. Most people who are working should have some form of personal insurance. 

But I'm also a huge advocate for self-insuring when you can. And a message I don't see enough is that your insurance needs should reduce as you get older.


  • As you get older, so do the people who depend on you. Every year is a year closer to your children becoming independent.

One of the reasons you take out insurance is to help your dependents while they depend on you. For example, in the event of your death, the amount you'll want to leave to support a 1-year-old is more than what you'll want to leave to support a 15-year-old, because you've already covered 14 years of dependence. 

  • As you get older, you should be building wealth, putting yourself in a better position to self-insure.

For example, as you build up an emergency fund, you can reduce the waiting period on your income protection policy. Changing the wait period from 4 weeks to 3 months can reduce premiums significantly. If you've paid off the mortgage, your life insurance doesn't need to provide for accommodation for your loved ones, because you've already done that.

I want to stress - in no way am I saying that you shouldn't insure. Most working-age people need insurance. The point I want to make is that while you may still have insurance needs, in most cases they will decrease over time.

This is another reason why it is worth regularly talking with an independent professional adviser about your insurance needs.

(Unlike most insurance advisers, Fairhaven Wealth does not receive commission in relation to insurance advice. As a result, Fairhaven Wealth has no disincentive to advise clients when they are over-insured.)


Sonnie Bailey

Sonnie is the founder and principal of Fairhaven Wealth.

Before founding Fairhaven Wealth, Sonnie worked in the legal and financial services industries for over a decade.

Sonnie first became involved with financial advice as a specialist financial services lawyer. For many years, he was an “adviser of advisers”, reviewing thousands of advice files prepared by hundreds of financial advisers, and providing feedback in relation to the quality and appropriateness of advice; industry best practice; risk management; and regulatory compliance. He has published work in industry publications and spoken at various financial advice conferences.

Sonnie has also worked with banks, investment management firms, insurers, and derivatives providers.

Sonnie has worked as a private client lawyer, focusing on succession, estate planning and trusts. He ran his own legal firm in Australia before relocating to New Zealand. He has also acted in independent trustee and company director positions.

Sonnie is passionate about helping people achieve their goals and manage the risks to which they are exposed.

He has written extensively on his blog, New Zealand Wealth and Risk, which can be found at

Sonnie is married to his wonderful wife Chrissy, and has two young children, Ben and Anna.