Funeral insurance

Does it make a difference when New Zealand Seniors claim they will pay amount insured or pay all of your contributions. With interest rates so low this at first glance seems OK'ísh.

Murray raises some good points, however, the fundamental point needed here, that has not been covered and is the reason there are so many complaints and cancellations, is no advice was taken.
With a suitably advised solution, the consumer should have no surprises and have a solution that works for them.
Yes, if the plan is solely relying on insurance to transfer the risk, there is a chance that they may live longer than anticipated and pay more for the cover than it delivers. That's a discussed point with a good adviser.
As too, taking the savings route, this has the risk of not being contributed to long enough to deliver the desired outcome. i.e dying early.
Where the consumer/policyholder has reasonable health, then an underwritten life cover, suitably structured, is often the more effective approach. They don't have a ceasing of premium option but are often able to be structured in a way that ensures they pay the minimum total premium possible. ie. fixed level premiums for the life of the policy, presently out to age 100 with many providers.
What also has not been stated in the article is funeral cover is life cover, just under another name.
The lack of medical questions is offset by the insurer charging a higher premium for the unknown risk and applying an exclusion period for those that buy the policy with terminal illnesses.
The metrics are relatively simple when understood and explained. The article does not clearly explain to the consumer audience how these work and what the alternatives actually look like.
And nor does it state to seek advice from an appropriate adviser to get it right.
And BTW just because an adviser is likely paid on commission it shouldn't take away from the value a consumer is able to gain from the interaction as they have multiple product options. As most salaried 'advisers' can only sell you their product.
Not to spark the debate on commissions and advisers, if you are looking for a good adviser check out Financial Advice New Zealand, a professional body of advisers who aspire to do what they do better.
(I'm a financial adviser and a member of Financial Advice New Zealand, but I'm not involved in the operation of the professional body, I'm just a member)

Hello

Consumer's article on Funeral insurance" says inter alia

".....deposits where your money earns interest.

If you want to ensure there's cash on hand to pay your funeral bill, the simplest option is setting up a savings account. The benefit of doing it this way is that you still have control over your money — and you avoid paying the set-up and other fees that typically come with pre-paid plans.

Funeral costs can also be paid out of your estate."

I think this overlooks an important point, viz that at death all the deceased's funds/accounts are frozen (ie cannot be accessed) until either probate (where there's a will) is granted to the executors or administration (where no will) is granted. The latter especially would take some time and this would be an impediment to early access to funds and early payment of a funeral bill. Consumer NZ may like to reflect on alternatives. For instance, while I'm no expert, possibly one way around this would be a joint savings account in both the deceased's and a relative's names with each person authorised to operate the account without the other's signature.

Does anyone know much about AIL Insurance American Income Life Insurance Company, they advertise quite extensively in NZ and are said to be partnered with some well established organisations in NZ but I can't find information on them through here in Consumer, I find that wee bit interesting.

Funerals are too. My family has instructions not to give me a funeral. And a cardboard casket is quite adequate. I want them to enjoy what little we have to leave them rather than use their inheritance lining the pockets of rich funeral directors. It's about time people revolted against having their grief exploited!