Written by Henry Smith · Reviewed by Smiths Insurance & KiwiSaver — licensed Financial Advice Provider (FSP712931) · Last updated 2026-08-15

Premium Loadings NZ: What They Are and How to Remove One

A premium loading is an extra amount an insurer charges above its standard rate because it has assessed you as more likely to claim than others of your age, sex, smoking status and occupation. It is normally expressed as a percentage of that standard rate, and Partners Life describes percentage loadings ranging anywhere between 50% and 400% depending on the additional risk identified. A loading is not a decline, it is not a moral judgement, and in most cases it is not permanent.

The important thing to understand is that a loading buys you something. Where an exclusion carves a condition out of your cover, a loading leaves the condition inside the policy and prices it. That distinction is the whole decision.

How a loading is expressed

There are two formats used in the New Zealand market, and they behave quite differently.

Percentage loading. The most common form. It is applied on top of the standard underlying premium rate for someone of your age, gender, smoking status and occupation, and Partners Life notes it is generally used for conditions that cannot be singled out for exclusion because they affect your overall health , diabetes and high blood pressure being the classic examples.
Per-mille loading. A fixed amount charged per thousand dollars of cover (insurers call this "per mille"), so it produces the same extra premium for every customer exposed to that risk regardless of age, sex or occupation. It is typically used for a dangerous occupation or pastime, or for someone in remission from certain cancers where the risk falls with every year that passes , in which case it may be set to run for a defined number of years and then stop automatically.

Because a percentage loading sits on the base rate rather than on a fixed dollar figure, it moves with the base rate. On a stepped structure, where the rate is recalculated against your age every year, the loaded portion rises alongside it. If you are weighing structures, read our guide to stepped versus level premiums.

Why underwriters apply one

Loadings are actuarial, not personal. The common triggers in the New Zealand market are:

Build. Chubb Life's Essential Underwriting Guide (May 2025) states that for a BMI of 18 to 36.9 there are no mandatory medical requirements, but notes a loading for BMI may still apply in some circumstances; a BMI of 37 or above triggers a build exam plus non-fasting HbA1c, lipid and liver function tests, and a BMI under 18 may also attract terms.
Medical history. Conditions that raise risk across your whole health profile rather than in one isolated place. Partners Life gives diabetes and high blood pressure as examples of risks that get loaded rather than excluded.
Family history. A strong family history of certain cancers can be loaded, again because it is not a risk that can be carved out of a single body part.
Occupation and pursuits. Pinnacle Life lists roles such as helicopter pilots, explosives handlers, professional divers and underground miners, plus pursuits such as competitive boxing, powerboat racing, hang gliding and mountaineering as risk factors that affect pricing.
Nicotine and cannabis. Smoking status is a rating category rather than a loading, and Chubb defines a non-smoker as someone who has not used tobacco or any nicotine replacement, vaping included, in the last 12 months; the same guide notes marijuana use of more than once a week can itself incur a premium loading depending on frequency.

It works the other way too. The same Chubb guide sets out a Lifetime Reward premium discount for applicants with a BMI between 18.5 and 24.99 who meet the non-smoking criteria, applied at policy inception for the life of the policy.

Loading versus exclusion: how an underwriter chooses

An underwriter has four broad responses to an application, and the choice between a loading and an exclusion turns on whether the risk can be isolated.

Outcome	What it does to your cover	When it tends to be used
Standard terms	No change to cover or rate	The risk sits inside the insurer's normal range (Insurance Link)
Premium loading	Condition stays fully covered; the rate rises by a set percentage	The risk affects your overall health and cannot be confined to one body part, such as diabetes or high blood pressure (Partners Life)
Individual exclusion	Cover is issued, but claims arising from that condition or activity are not paid	The risk is confined to one identifiable thing , a previously injured knee, a specific hobby (Insurance Link)
Decline or deferral	No cover, or a decision postponed	The risk is currently too high or too unclear to price (Insurance Link)

Two people with near-identical histories can be offered quite different terms by different insurers, which is exactly why an exclusion is often what makes cover possible in the first place rather than a sign the door is closed. How we weigh those differences across insurers is set out in our methodology.

Can a loading be reviewed or removed later?

Usually, yes , but it takes evidence, and it takes you asking. Insurers do not run these reviews for you.

Partners Life states that apart from rare per-mille loadings applied for cancer, all other special terms can be reviewed at any time, and that a loading on existing benefits cannot be increased as a result of the review even if your health has since deteriorated. That last point matters: the review is asymmetric in your favour.

What the evidence has to show depends on the type of loading:

Percentage loadings. Improvement in the original condition alone is not enough. Partners Life requires medical evidence of a lowered claim risk based on your current overall health profile at the date of the review.
Occupation or pastime per-mille loadings. Evidence that you have left the risky job or stopped the risky hobby will see the loading removed regardless of your current health profile.
The paperwork. Fidelity Life's quick reference underwriting guide (November 2024) requires a fully completed application form for a loading review so the underwriter can reconsider the whole risk profile, with supporting medical information obtained at your expense , reimbursed if the terms are in fact altered.

Exclusions follow a similar path. The same Fidelity Life guide requires the relevant section of the application or a questionnaire for an exclusion review, and a fully completed application form for a mental health exclusion.

What to do if you are offered a loading

Get the reason in writing. You cannot challenge or plan around a decision you do not understand. Ask which disclosure drove it and what would need to change.
Test the market before you accept. Terms genuinely vary between insurers, because each one assesses risk differently and weighs the same history in its own way. A pre-assessment through an adviser lets you sound out appetite first , though Fidelity Life is explicit that a pre-assessment is an indication of possible terms only, not an offer of cover or a binding assessment.
Decide whether you would rather have the exclusion. A loading keeps the condition covered. If the condition is the very thing most likely to cause a claim, that is worth paying for.
Diarise the review. Put a date in the calendar for when you expect your health, weight or occupation to have changed, and lodge the review then.
Do not cancel existing cover until replacement terms are issued and accepted in writing.

Never leave something off the form to dodge a loading

This is the expensive mistake. In a case published by the Insurance and Financial Services Ombudsman in July 2025, an insurer that discovered undisclosed conditions at claim time applied 50% loadings to the customer's life and trauma covers retrospectively and paid a reduced amount, reflecting what it would have charged had it known. The complaint was not upheld.

The disclosure rules are also changing. The Contracts of Insurance Act 2024 received the Royal assent on 15 November 2024 and replaces the current duty with an obligation on consumers to take reasonable care not to make a misrepresentation. MBIE confirms the changes take effect on 15 November 2027, and the FMA has written to insurers setting out its expectations ahead of that date. Until then, and after, the safe course is unchanged: disclose everything, including the old news.

Your next step

If you have been offered a loading, or you are carrying one that has never been looked at, the useful next move is a comparison of what other insurers would offer on the same history , and a conversation about whether your existing loading is now reviewable. Start with a free cover check, or read more about how life insurance, trauma insurance and income protection are underwritten.

This article is general information only and is not personalised financial advice. Underwriting rules, special terms and review criteria differ between insurers and change over time. Craig Smith Business Services Limited is a licensed Financial Advice Provider, FSP712931, listed on the Financial Service Providers Register.

References

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