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.
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.
However, once you move into the self-employed space things can get a little trickier and that is where ACC Cover Plus and ACC Cover Plus Extra come in to play.
ACC Cover Plus is basically the self-employed version of ACC cover. The rate of cover provided, what is covered and the services available are all the same as ACC. What changes is how you pay your levy and how your cover for lost earnings is decided.
When you are an employee your ACC levy is automatically deducted from your income, however when you are self-employed you are invoiced each year by ACC according to your previous years income and your industry. This means your ACC invoice can vary from year to year depending on your income or if you change industries.
When you are an employee and you lose your income due to an injury there is a very clear line as to what that lost income would be – your wages or salary. Self-employed incomes can fluctuate dramatically from month to month or year to year and this can cause some challenges and uncertainty when trying to get covered by ACC.
New Zealanders are lucky to have access to ACC, and with ACC Cover Plus even as a self-employed person you are covered. However there are two areas that ACC Cover Plus can be challenging. The first is with the levy based on the previous financial year’s income there is uncertainty each year as to what it will be. Secondly the uncertainty around cover with a fluctuating income can leave self-employed people more vulnerable.
This is where ACC Cover Plus Extra comes in.
With ACC Cover Plus Extra you agree with ACC on a level of cover for lost earnings, to suit your personal circumstances. This means if you make a claim there is no need to prove your earnings, as the weekly compensation has already been agreed. It also means you know what your ACC levy will be each year which makes financial planning smoother.
Moving on to ACC Cover Plus Extra puts you back in control of your premiums, puts you in control of what you get paid at claim time and gives you peace of mind regarding what you will get paid.
ACC is an expensive type of cover when compared with private insurance. There are some gaps with regards to illness and degeneration, and moving onto ACC Cover Plus Extra is the first step to make things easier.
We then tailor your ACC cover so it is right for you. This may be by reducing the cover and taking on income protection and mortgage protection to top it up, or we could recommend you increase it.
There are three main benefits to taking this approach.
We have had clients who have income protection in place, but are also paying the default ACC Cover Plus Levy – essentially doubling up and paying twice. You can only claim on one of these so you shouldn’t be paying for both of them.
It is important to remember that reducing ACC Cover Plus Extra also reduces the entitlement for accidental death cover. This is where talking to one of our advisers is important so they can advise you of all the implications and how to best cover yourself.
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If you are ready to review your ACC levy and make sure you have the most comprehensive cover in place, get in touch with one of our team.
Here are a few reviews from some of our existing clients around New Zealand