Copy of HOW DOES INCOME PROTECTION INSURANCE WORK?

We get asked the question ‘what am I covered for?’ all the time. There are three main categories; not being able to work in your occupation due to ill health, losing your job via redundancy or not being able to work due to an accident.

Health & Accident Cover:

Income protection covers you for both accidents and ill health claims. You can’t claim ACC and certain types of Income protection together. Although ACC is compulsory for all working New Zealanders, the self-employed have the option to elect their cover levels, whereas being employed you cannot.

Redundancy Cover:

This cover is generally limited to a six-month benefit, i.e. if you lose your job, you receive a replacement income for up to six months. However, if you know your job is on the line, you can’t take out this cover, and if your company is on the brink of receivership or liquidation, most insurance companies will have already red flagged your company (or even industry) as an exclusion.

Accident Cover:

Whether you like it or not, we all pay ACC if we’re working. If you are employed ACC will pay you 80% of your income based on your IRD information. If you are self-employed, it’s a little different – you are also paid on your income, but as we all know, it depends how your accountant has structured your income, e.g. have you split your income with your partner?

Be aware that if you have an accident, ACC will pay you based the amount you stated in your last annual return as ACC is a complex monster, you need to seek advice from an adviser who can show you how to structure your policy – for free!

Call us to discuss, with no obligation, your individual situation on:

Off 09 360 5555

Mob 0273 000666

E mail info@suninsurance.nz