When you’re self-employed it’s essential to make sure you’re adequately covered should you be unable to work, especially if your business is unable to continue earning without you! If you’re self-employed or a non-PAYE shareholder-employee in New Zealand, there are different options available for cover through the ACC if you’re injured and unable to work.
You have two options for your ACC cover, either ACC CoverPlus or ACC CoverPlus Extra. ACC CoverPlus Extra is an optional cover that extends beyond the standard ACC CoverPlus.
If you’re self-employed or a contractor you’ll automatically be placed on CoverPlus. With CoverPlus, if you have an accident and can’t work, ACC will pay your compensation at 80% of your recent provable income. Weekly compensation payments start a week after your injury.
However, the option is available to switch to the flexible alternative, CoverPlus Extra. CoverPlus Extra differs in that it allows you to choose how much of your income you want to cover if you have an accident and can’t work. On CoverPlus Extra, ACC will pay 100% of the amount of cover you have chosen, even if your business continues to generate income. There is also no expectation for you to prove your loss of earnings on CoverPlus Extra, and your weekly compensation payments will start within a week of making a claim.
To be eligible for CoverPlus Extra you must be self-employed or a non-PAYE shareholder-employee (pay as you earn), who works 30 hours or more, or if you work part time and earn an income that’s above the ACC CoverPlus Extra minimum (which changes every year).
This option is suited to those who:
- Have fluctuating income, either yearly or seasonal as you’ll know exactly how much ACC will pay.
- Want control and certainty over how much you’re covered for.
- Are newly self-employed with no earnings history and want assurances around your cover.
- Would have difficulty proving a loss of income should you be injured.
- Have monthly disability insurance in place such as income protection, as you may wish to reduce your level of ACC cover as you have other protection in place.
Having a plan in place to cover you financially if you’re off work is essential! If you want to make sure you have a plan in place should you be unable to work due to sickness or injury, speak with me for personalised financial advice.