New Zealanders remain confused about what is covered by ACC - and as a result, many are not seeking the financial protection they may need. Here’s what a recent report has revealed.
One in five Kiwis expects ACC to cover them for serious illnesses
The no-fault accidental injury compensation scheme only covers injuries resulting from an accident. But according to a recent study* released by insurer Partners Life, many respondents mistakenly thought they would be covered by ACC if unexplained back pain (25%) or hernia (18%) put them off work.
What’s also concerning is that 18% believed that ACC would cover time off work in the event of a serious illness, like cancer - which unfortunately it’s not the case. As we said, ACC is designed to provide financial support for accidental injuries, but it wouldn’t step in if you experienced a serious medical condition.
How insurance can benefit you
Insurance types like income protection and trauma insurance can help bridge your protection gap. Provided you meet the policy terms, income protection would provide replacement income if you were unable to work due to a serious illness or injury. As for trauma insurance (or critical illness cover), it would pay a lump-sum amount if the insured person is diagnosed with one of the conditions specified in the policy. Covered conditions vary from provider to provider, but they usually include cancer, strokes and heart attacks.
As you can see, these are powerful protection tools. Unfortunately, as the survey found, only 13% of Kiwis have trauma insurance, and just 9% have income protection.
So, why aren’t more people getting cover?
Costs were by far the most frequently mentioned reason (58%). Other common reasons were:
- Being too young to need coverage (17%)
- Believing that insurance would not benefit them (15%)
- Not having any assets (13%)
- Believing that ACC had them covered anyway (9%).
Are any of these misconceptions keeping you from protecting your financial future? As insurance advisers, we can help you understand your options and find solutions that are appropriate for your needs, goals, and budget.
Insurance premiums vary widely depending on the type of cover, and we can assist you in finding a solution that suits you. Plus, the cost of not having insurance is also worth considering.
As for ‘being too young’, it’s actually never too early to seek financial protection: the younger and healthier you are, the fewer exclusions or loadings your policy is likely to carry - which means that any future medical conditions will likely be covered.
And of course, it’s important not to rely on ACC for all financial protection needs. If you’re looking for ways to protect your future from the unexpected, a personal insurance plan can give you and your loved ones invaluable peace of mind.
Can we help you?
Would you like to explore your insurance options? Please don’t hesitate to contact us. We’re here to help.
*Methodology: Partners Life surveyed over 1,000 respondents.
Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.