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Do I need Income Protection Insurance?

Do I need Income Protection Insurance?

The purpose of Income Protection insurance is to give you an income when you are unable to work for an extended period of time. This means if you can’t work,

  • you can keep up with your rent or mortgage repayments
  • you can cover your ongoing bills and everyday expenses such as bills and groceries
  • you don’t need to rely on family or friends for financial support.

For most of us the idea of managing with no income for 3 months or longer is pretty scary, so what are the chances?

Every year over 50,000 New Zealand households have someone in the family who is unable to work for 3 months or more.

While ACC covers accidents, it may not replace all your income. It also won't provide for you if you become ill. And, the most likely reason that you may not be able to work for an extended period of time is illness.

88% of health loss in NZ is attributed to long term mental and physical conditions. With the main causes being coronary heart disease, chronic obstructive pulmonary disease, chronic kidney disease, bowel cancer and self-harm.

The second contributor to health loss is injury (8%). Last year ACC had 200,807 claims (12 months ending September 2017). Of these 13,855 were still unable to return to work after 9 months.

  • 137,350 (68.4%) returned to work with 10 weeks
  • 178,300 (88.8%) returned within 6 months
  • 186,951 (93.1%) returned within 9 months
  • Leaving the rest still unable to work.

Which is why we think protecting your income is so important.

For more information, check out our other blogs on Income Protection or head to the products section on Income Protection. If you want to find out how much it will cost, click on the quote link below.

Sources:

https://www.health.govt.nz

https://www.acc.co.nz/assets/corporate-documents/acc-first-quarterly-report-2017-2018.pdf

http://archive.stats.govt.nz

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