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NZ earthquakes, tsunamis and bad break-ups: what can we insure ourselves against?

New Zealand had an earthquake last Friday. This is big news in New Zealand, especially after the earthquakes in Christchurch a few years ago now. There were fears of a tsunami rolling in and damaging the coastal towns (not that this stopped kiwi’s going down to the beach for a look).

It occurs to me that we spend thousands of dollars every year on insurance, protecting ourselves from these risks which (to be honest) are small. We have home insurance, contents insurance, life insurance, car insurance, health insurance… the list goes on. I can’t remember ever actually making a claim, but still every year we spend thousands and thousands on these things.

But you say – you can’t NOT have insurance. And I agree. It would be wrong to not have insurance – if the worst happened and you were not insured, how  could we bounce back?

But it’s interesting to note that so many people entering into a new relationship fail to take any steps to protect or insure their assets from a much more common risk – a bad breakup. I don’t know anyone who has not had one (unlike the insured risks from fire/earthquake/storm/etc).

In fact, I know a few people who have had quite a few break ups, so that their financial position is about 10% of what it would have been if they took steps to protect their wealth after the first go.

Being a lawyer in Kerikeri means I know quite a few people in this town. I know many small business owners, many farmers, many parents… who could (and should) take some steps to protect their wealth from a separation. I am not talking about a fair split of your property with your spouse if you’ve been together for a while and have children, I am talking about those individuals who have already built up assets – perhaps from hard work or perhaps from an inheritance – and who don’t seem to realise that they can create a form of insurance for their relationship property.

A contracting out agreement (known in many parts of the world as a “pre-nup”) is an agreement that a couple enters into, usually when their relationship starts, which sets out who has what and what will happen to the property if there is a separation. A good agreement (not something scribbled on napkin at dinner) will set out clearly what happens and ensure no arguments in the future.

A standard contracting out agreement can cost between $1,200.00 - $1,600.00, including gst, if done correctly. Your partner would also need to instruct a lawyer to receive advice. If there is a dispute, or complicated issues arise, it can be a little more pricey. Sure you can get them cheaper, but it is important to create a strong agreement which ‘ticks all the boxes’. At the end of the day you are trying to protect your property from a messy separation, it is vital to get it done properly and not cut any corners. If you cut corners the agreement may not be as strong as you would like… There are certain things that the lawyer has to do to ensure your agreement is as close to watertight as possible.

I see contracting out agreements as another form of insurance. If you undertake a cost/benefit/risk analysis of obtaining an agreement, when compared to what you spend annually on all those other insured risks… the question should not be do I need the agreement (if you are asking yourself this question then you probably need one), but why the hell haven’t’ I done it yet?

If you would like to discuss this type of relationship insurance, you can contact Law North Lawyers in Kerikeri on info@lawnorth.co.nz or 4077099, or contact me directly: Graham@lawnorth.co.nz I would be more than happy to discuss these things with you by email or phone to see if this is something you do need.

Law North Limited Lawyers – Lawyers for Kerikeri, Paihia, Kaikohe, Bay of Islands, and the rest  of the Far North of New Zealand

• Posted By: Graham Day on Thu, 8th Sep 2016 @ 08:07:46

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