How ACC payments work

When ACC accepts a claim and the injury stops you working, the main income entitlement is weekly compensation. The headline is that it is generally around 80% of your pre-injury earnings — but each of the words in that sentence carries statutory detail, and it is the detail that determines what actually arrives in your account.

“Pre-injury earnings” is a calculation, not a figure you nominate. For employees it is generally based on recent earnings from employment. For the self-employed it is based on earnings from a defined earlier period, unless a CoverPlus Extra agreement has fixed the level in advance. For people with irregular income, or who have recently changed circumstances, the calculation can produce a number that feels disconnected from reality.

“Around 80%” is also subject to a maximum. Legislation sets a level of insurable earnings above which weekly compensation is not calculated, which means higher earners receive proportionally less of their actual income. And the payment is taxed, so the amount that lands is lower again.

1. 1

   The injury and the claim

   A claim is lodged, usually through the treatment provider. ACC assesses whether it is a personal injury caused by an accident.

2. 2

   The first period

   Employer obligations and ACC entitlement begin at different points, and sick leave may be in play. Understand how the first week or two works for your situation, because it is a common gap.

3. 3

   Weekly compensation begins

   Once entitlement is established and you are certified unable to work, payments start at the calculated rate, taxed.

4. 4

   Ongoing certification and management

   Medical certificates continue, and ACC actively manages rehabilitation and return to work. Expect involvement rather than a passive payment.

5. 5

   Graduated return to work

   Where you can work partially, payments are adjusted to reflect what you are earning. Returning gradually does not mean losing the entitlement outright.

6. 6

   Entitlement ends

   When you can work again, or when the covered incapacity ends. ACC is not a long-term income replacement scheme for anything other than continuing covered incapacity.

How it fits with private cover

• Most income protection policies offset ACC weekly compensation, so the combined amount equals the insured benefit rather than exceeding it.
• Waiting periods on private cover should be chosen with sick leave and any likely ACC entitlement in mind.
• Where ACC declines a claim, the private policy is carrying the whole risk on its own definition of disability.
• Tell both ACC and the insurer about the other claim. Undisclosed parallel payments produce clawbacks.
• Where a claim moves between ACC and private cover — a decline, then a review decision — the sequencing needs managing.

These are the details that decide whether the cover does what you expected. Read them before you compare on price.

• How your pre-injury earnings would actually be calculated on your particular income pattern.
• Whether you are above the maximum insurable earnings level, which caps what ACC would pay.
• How the first period after an injury works for you, including sick leave and employer obligations.
• That payments are taxed, so budget on the after-tax amount.
• Whether your income protection waiting period leaves a gap.
• How the offset clause in your private policy treats ACC payments.

Every New Zealand insurer writes income protection cover to its own wording, and the words are where the money is. Two policies that look identical on price can pay very differently when it matters. Closing that gap is the entire job of an adviser.

• An adviser can estimate your realistic ACC position so private cover is sized to the actual gap.
• They will set waiting periods against sick leave and likely ACC entitlement rather than by default.
• They read the offset clause with you before you buy, which is the only time it can be changed.
• At claim time they can run the private claim alongside the ACC claim so the offsets are applied correctly.

There are three ways to buy life cover in New Zealand, and they are not equivalent. You can buy direct from one insurer, which means you see one product range and one underwriting appetite. You can buy through your bank, which usually means a single insurer’s product sold under the bank’s brand, often with narrower definitions. Or you can go through an adviser, who quotes several insurers at once and is required to put your interests first.

The premium you pay is the same either way. Insurers build adviser commission into their pricing whether or not an adviser is involved, so going direct does not get you a discount — it just removes the person whose job is to argue your corner at application and at claim time.

• An adviser can see which insurer is currently taking your health history on standard terms, and which one will load or exclude it.
• An adviser can structure cover across two insurers if that produces a better outcome than putting everything with one.
• An adviser handles the underwriting back-and-forth, and is the person who chases the claim when a family is least able to.
• An adviser has to document why the recommendation suits you, which is a written record you can hold them to.

We are a referral service, not an insurer. We do not quote premiums and we do not sell policies. What we do is put you in front of one licensed New Zealand adviser who can compare the market properly.

1. 1

   You tell us what you are looking at

   The form takes about a minute. Nobody asks for your medical history on a web form — that conversation happens with the adviser, properly, and only once you have decided to proceed.

2. 2

   An adviser calls you

   A licensed New Zealand adviser talks through your situation: who depends on you, what you owe, what you already have in place, and what you are actually worried about.

3. 3

   They compare the market

   The adviser quotes across the major insurers, checks which of them will take your health history on the best terms, and puts the options side by side in writing.

4. 4

   You decide, in your own time

   There is no obligation and no cost to you. If the answer is that you already have enough cover, a good adviser will tell you that.