Income Protection Insurance in New Zealand

Safeguard your financial future with income protection insurance. Learn about different types of cover and how they can help you maintain your lifestyle if you're unable to work due to illness or injury.

What is Income Protection?

Income protection insurance provides regular payments to replace a portion of your income if you're unable to work due to illness or injury. It helps you maintain your lifestyle and meet financial obligations during recovery.

Types of Income Protection

Agreed Value Cover

Pays an agreed benefit amount. Payment is offset by other income such as ACC

  • Guaranteed payout amount
  • Suitable for fluctuating incomes
  • Higher premiums

Indemnity Cover

Pays a benefit based on your income at the time of claim. Payment is offset by other income such as ACC

  • Lower premiums
  • Benefit reflects recent income
  • Suitable for stable incomes

Loss of Earnings Cover

Compensates you for the actual income you've lost due to illness or injury.

  • Tailored to actual income loss
  • Encourages partial return to work
  • May include overtime and bonuses

Mortgage Repayment Cover

Similar to Agreed Value Cover, but does not have offsets.

  • Guaranteed payout amount
  • Arguably the best income protection product
  • Typically no offsets apply to the benefit

Factors Affecting Your Cover

Wait Period

The time between becoming unable to work and when your benefits start. Options include 4 weeks, 8 weeks, and 13 weeks. Longer wait periods usually mean lower premiums.

Benefit Period

How long your payments will last. Options include 2 years, 5 years, to age 65, or to age 70. Longer benefit periods generally result in higher premiums.

Income % Covered

Usually 62.5% (non-taxable) or 75% (taxable) of your pre-disability income. The higher percentage typically results in higher premiums.

Benefits of Income Protection

Financial Security

Maintains your income stream if you're unable to work, helping you meet ongoing financial commitments.

Flexibility

Tailor your cover to your specific needs and budget with various options and add-ons.

Peace of Mind

Reduces stress and anxiety about financial stability during illness or injury recovery.

Lifestyle Protection

Helps maintain your standard of living and protects your long-term financial goals.

Income Protection Benefit Calculator

Frequently Asked Questions

What's the difference between income protection and ACC?
While ACC covers accidents, income protection insurance covers inability to work due to illness or injury, including those not covered by ACC. Income protection can provide more comprehensive coverage for a wider range of scenarios.
Can I claim income protection if I'm self-employed?
Yes, income protection insurance is particularly valuable for self-employed individuals who don't have employer-provided sick leave or other benefits. It can help replace lost income if you're unable to work due to illness or injury.
How long does income protection pay out?
The benefit period can vary depending on your policy. Common options include 2 years, 5 years, or up to a certain age (typically 65 or 70). Longer benefit periods generally result in higher premiums.

Protect Your Income Today

Don't let illness or injury derail your financial future. Get personalized income protection insurance quotes tailored to your unique needs with InsureAI NZ's advanced AI technology.

Compare Income Protection Quotes