Thinking of ditching insurance for a DIY 'stash away the premiums' approach? Self-insurance sounds smart, but is it really? In this episode, Tim and Nick unpack why skipping cover can backfire, the behavioural biases that trip us up, and why integrating risk management into your financial plan is essential for long-term security.

(00:00:00) Intro: What is self-insurance and why it sounds appealing

(00:00:57) Nick explains the concept and why people consider it

(00:03:38) Inflation and rising costs make self-insurance risky

(00:05:38) Behavioural biases: present bias and optimism bias

(00:07:39) Why transferring risk to an insurer matters

(00:09:35) Nick’s real-life claims story

(00:11:02) $18,000 car repair and the ripple effect

(00:11:30) $1.20 washer leads to $55,000 home damage

(00:12:34) $28,500 medical costs

(00:13:55) Why self-insuring would have failed in this scenario

(00:15:54) The importance of holistic financial planning and insurance

(00:18:10) Closing thoughts: seek advice and integrate risk management

The Adviser Talk is available on all major streaming platforms, including Spotify and Apple Music.

• Nick Stewart is a Financial Adviser and CEO at Stewart Group, a Hawke's Bay and Wellington-based CEFEX-certified financial planning and advisory firm. Stewart Group provides personal fiduciary services, Wealth Management, Risk Insurance and KiwiSaver solutions.
• The information provided, or any opinions expressed in this show, are of a general nature only and should not be construed or relied on as a recommendation to invest in a financial product or class of financial products. You should seek financial advice specific to your circumstances from an Authorised Financial Adviser before making any financial decisions. A disclosure statement can be obtained free of charge by calling 0800 878 961 or visit our website, www.stewartgroup.co.nz

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