The Accident Compensation Corporation (ACC) provides support to everyone injured in an accident in New Zealand. The scheme began in 1974, but had its roots in the Workers Compensation Act of 1900 - a no-fault Government scheme to compensate injured workers. Today, ACC covers a much wider range of situations - but many people don't know much about it until they are personally affected!
If you’re interested in taking out health insurance or income protection insurance in New Zealand, you might be curious about how your ACC claims intersect with these forms of cover. Here’s a brief guide to ACC, including the work-related support you can receive and more general assistance.
Who’s covered, and what’s covered?
ACC provides financial support to children, beneficiaries, students, worker and people who are unemployed or retired. It also applies to people from overseas who are injured while travelling here, and in some cases to New Zealanders travelling overseas. The scheme covers the cost of emergency treatment, rehabilitation and associated costs arising from general physical injuries sustained in an accident. It covers the cost of physical and psychological injuries resulting from sexual violence. Conditions that develop gradually because of work (such as back problems, deafness or repetitive strain injuries), and in some cases injuries that are long-term or permanent, or that happened at birth, also fall under the umbrella of the ACC scheme. Injuries sustained in the course of receiving medical treatment are also covered by ACC. With the exception of claims related to sexual violence, claims generally have to be made within 12 months of incurring the injury.
Despite ACC's broad reach, there are still a variety of common conditions and situations that New Zealanders unfortunately can't get financial help for. Contagious diseases (such as Covid-19) and major and minor illnesses (including cancer) are not covered by ACC, unless they can somehow be traced back to your workplace - though if you need medical treatment for these conditions, this still falls under our public health system. Emotional issues, stress-related conditions or mental illnesses are not covered by ACC, unless they’re linked to an injury that's already covered, such as a physical assault. Conditions relating to ageing, damage to items such as hearing aids and other medical devices, sunburn, and injuries that happen over a period of time (and are not caused by work) are also excluded.
ACC support relating to work
ACC claims can take up to a week to process. If you're injured at work, your employer must pay for the first week of your lost earnings, and if not, you're expected to take annual leave until your payments come through.
Income support if you were employed before your injury: If you were employed when your accident or injury happened and now you can’t work, or can’t work full-time, you can receive up to 80% of your income every week in total from ACC. The maximum amount you can receive in 2021 is $2066.58 per week (which reflects the maximum liable income rate, or income someone must pay ACC levies on). Maximum and minimum liable income rates are set every year. Income support is available to people who are working for someone else, who are self-employed and who are shareholder-employees (in other words people who both work for and have shares in a company, including company directors). You need to provide proof of employment and a medical certificate to receive this kind of support.
Income support if you’re not employed: If you were employed within the 28 day time period prior to your injury, but unemployed when it actually happened, you can still receive payments – as long as you were due to start a new job within three months. Seasonal workers can also receive income support if they have completed at least two seasons with the same employer before the accident happened and can prove they are expecting to complete another. If you were paid out after leaving your last job and were still receiving this pay when the injury happened, you can also receive income support.
Support getting back to work: When your doctor evaluates you, you’ll either be certified as “fully unfit” or “fit for selected work”. If you’re fit for selected work, ACC can help by getting an occupational therapist to speak to you and your employer, to work out appropriate tasks that aren’t going to impede your recovery. If you’re still not earning your pre-accident income ACC can also top this up. You need to provide a medical certificate regularly (about once every 3 months). ACC can also help you get to and from work if you need different transportation as a result of your accident and setting up your workstation. A rehabilitation programme will be set up for you, and the team handling your case will check in with you and your doctor to check your progress.
Support in your life outside of work
Home help: Under ACC you can receive help with cleaning, looking after your home, and attendant care. To help you with personal activities like showering and dressing. If you’re staying with someone else while you recover, ACC may still be able to cover you. How much support you need will be determined by an independent assessor.
Transport costs: You can also claim general transport costs from ACC. The scheme covers mileage, public transport, taxis and car rentals, any changes you need to your vehicle (modifications), and emergency transport to the hospital. ACC will also support you retrain for your driver’s license, if this is something you need. Before you can claim anything back from ACC for public or private transport costs, there is a minimum amount you need to spend, however.
Support with childcare and education: If you’re an injured parent or caregiver, and you can’t care for the child or do everyday activities for them you can receive support. This can include the cost of taking your child to play centre or kindergarten, or of having someone come to your home to assist you (for instance preparing food or doing other daily tasks). If it’s your child who is injured, ACC can also help with both the cost of caring for them appropriately and the cost of getting a home tutor to help them catch up on schoolwork.
Travelling for treatment and rehabilitation: This can also include accommodation costs - but you have to travel a minimum distance in order to be eligible for this.
Counselling and therapy: ACC covers both counselling after physical injuries if needed, and after physical or psychological injuries arising from sexual violence. Counselling is usually offered for a specific number of sessions (10 or 14 respectively) which can be extended in some situations.
How does ACC work with your income protection insurance?
The biggest difference between ACC and income protection insurance is that income protection covers a much wider range of situations. If you have this form of insurance, you will usually be eligible to receive a percentage of your income if you cannot work due to serious illness or injury - regardless of how the injury or illness was caused. However, if you’re also eligible for ACC income support, the amount you can receive from your insurer will be offset against your income support payments. For example, Pinnacle Life reimburses policy holders for up to 75% of your income. If you're injured in a car accident and are off work for two months, you're already covered by ACC for 80% of your income, so you won’t receive anything from this insurance provider.
On the other hand if you can no longer work due to something that isn’t covered by ACC – for instance you catch a contagious disease or develop depression or a stress-related condition like burnout or anxiety, and can’t work, you will be eligible for 75% per week, for as long your policy stipulates. This could be a few months, or several years. ACC payments are also based on your last 52 weeks' earnings, whereas insurers are often a bit more flexible. You may be able to choose an agreed amount, or ask for a policy that would compensate you at the rate of your best consecutive 12 months in a three-year period. If ACC decides you are fit to work, but in a different job, your insurer may also be able to step in and cover you until you are ready to return to your own field.
The risk that something might happen that ACC won’t cover you for leads many people to take out income protection insurance. But there are other reasons why you might pick this form of cover, including receiving enough support when you’re self-employed and your income fluctuates.
ACC Cover Plus and Cover Plus Extra
If you’re self-employed or own a business, you might already be aware of ACC’s Cover Plus and Cover Plus Extra (CPX) schemes. Cover Plus is based on your income in the past financial year, but CPX allows you to pick the amount you receive if you become injured: essentially functioning as an insurance policy, but only for situations that would have been covered by the general ACC scheme. The downside of this cover is, as with insurance, you will have to pay higher levies. Take a look at ACC’s guide for the self-employed, which compares the two options.
Is income protection right for you?
Income protection policies don't come cheap, and you can expect to pay more if you work in a field that requires perfect physical health - but if being unable to work due to illness is a possibility that worries you, paying extra to be covered by a private provider has an understandable appeal. If you're interested in income protection it's a good idea to shop around, and take a good look at the perks and benefits that come with each scheme: for instance home care benefits, bed confinement benefits, and child support benefits. There are also other forms of insurance available, such as trauma cover, that may be helpful either alone or in conjunction with income protection, depending on your situation.
If you want to learn more about income protection, check out our brief overview of this form of insurance here. If you want to talk about your options when it comes to replacing your lost income in the event of a health crisis, you can also schedule a free chat with an independent insurance adviser via Quashed today.
How does ACC work with your health insurance?
If you have expenses arising from an injury or a health condition that ACC would generally cover, you might have to prove your claim has been declined before you can get help from your insurer. Some providers of health insurance (such as Southern Cross) have an advocacy team who can put your case forward to ACC on your behalf. If your claim is ultimately unsuccessful, your insurer will pay for the treatment and rehabilitation you need (as long as it's covered in your policy). To read more about health insurance, check out our brief guide: and before you sign up to a health insurance policy, make sure you have an understanding of how your insurer deals with claims, and ask for clarification if necessary.
If you decide to take out income protection insurance, or health insurance, don’t forget to upload your policies to Quashed! Our free online platform is easy to use and allows you to see all of your insurance policies in one place.
