In New Zealand we are lucky to have ACC, which provides us all with no-fault comprehensive injury cover no matter where you are when you are injured.
However many people have a limited understanding of what exactly is and isn’t covered by ACC and therefore how they can and should plug the gaps with other forms of personal insurance.
ACC covers most physical injuries if they are caused by an accident, a condition that comes on gradually because of your work, medical treatment or sexual assault or abuse. ACC provides a definition of a physical injury on their website here.
In addition to covering the costs of medical treatment ACC may cover home modifications, home help and weekly compensation payments. They will also work with you to put a plan in place to get you back to work. What many people also don’t know is that ACC provides a range of financial support following death as a result of an injury – regardless of what other cover you may have in place.
So that all sounds pretty good, and we really are lucky as a country to have this system in place.
But did you know that only 51% of disability claims are the result of an injury?
There are two main areas where ACC is not going to be much help.
The first is the grey area between degeneration and old injuries. With older injuries there may be an element of degeneration – because after a while we all start to degenerate! If there is any debate about whether your knee pain is the result of that rugby injury you had fifteen years ago or just wear and tear, ACC is going to lean towards wear and tear – which means they may not cover it and you may be left footing the bill.
The second area is illness – if 51% of disability claims are the result of an injury, that means almost half are the result of illness. The two biggest claims on income protection are back problems, which are notoriously difficult to trace to a specific injury, and mental health.
There are some examples from ACC on what they don’t cover here, which include illness, stress, conditions related to aging and injuries that come on gradually.
Because ACC can fall short when you need it we have some recommendations on what you can do to plug the gap to make sure you are covered.
Our first recommendation is income insurance, so if you are unable to work for a period of time as a result of illness you would continue to have an income (see our blog here on why your ability to earn an income is your greatest asset). Some income insurance policies also include rehabilitation benefits and retraining benefits, helping you get back to work sooner.
We would also recommend having some trauma protection in place which will cover you with a lump sum pay out in certain events, such as a heart attack, stroke or cancer diagnosis.
And of course medical insurance. Not only does medical insurance help cover treatment and medication costs but you can also choose to be covered for the cost of diagnostics.
Having personal cover in addition to your rights to access ACC is a smart move to make sure you are taking care of yourself and your family, regardless of what may happen.
Although this can seem confusing and may be a lot to get your head around, our brokers are well versed in the ins and outs of the system and can sit and talk you through which covers will best meet your needs. Call one of our brokers today if you have more questions.
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