In NZ, we are fortunate to have the Accident Compensation Commission (ACC) that provides an income benefit.  

ACC pays for injuries only and here is a list of circumstances that could put you out of work and ACC not cover:

• Non-occupational injuries that come on gradually;

• Stress or other emotional issues that are not a result of a physical injury or sexual abuse;

• Non-traumatic hernias;

• Death not caused by a physical injury.

There are also some limitations.  It contributes to medical costs but may not pay 100% of all treatment costs and benefits are limited to home care costs, such as equipment, attendant care and child care needed for your rehabilitation.

ACC pays for your loss of earnings while you are recovering from your injury, but only at 80% of your weekly earnings, limited to $96,000 a year.  They expect you to have insurance coverage that covers you for situations it does not cover and to supplement its benefits.

They do not provide any funds towards a mortgage loan payment, regardless of whether you are out of work from an injury.

ACC views pre-existing conditions and health issues as a degenerative disease. It considers that the average person is cured once they return to a state of health before their injury.  The key phrase there is “before their injury.”

Because of this, it is important that younger people not only understand these limitations but that they take the initiative to plan for natural occurring health issues and purchase alternative insurance cover; the earlier the better.

It is also important that consumers don’t rely on the Social Welfare and are proactive in managing their own financial affairs by considering the benefits of programs such as Disability Income Insurance, which covers injuries as well as illnesses.

Be alert to these issues and don’t wait until you have an accident to figure out exactly how much money you will receive in compensation payments.