Getting home and hosed on your ACC

The following article provides general ACC advice in relation to self-employment, tailored to Real Estate Agents.  It was written in July 2017 for REINZ magazine, on behalf of Matt Thomson, ACC and Insurance Savings specialist at Plus4 Insurance Solutions.

Reproduced here as a sample of my insurance writing, I recommend that you seek ACC and insurance advice specific to your personal situation.

As a Real Estate Agent, you typically encounter peaks and troughs in income.  If you had an accident, you don’t want ‘bad timing’ to whittle away your ACC entitlement.

If you’ve ever asked yourself the question, “What am I paying my ACC bill for?”, as a professional insurance agent with real estate clients, I aim to give you some straight-shooting answers.

This article focuses primarily on the income replacement aspect of ACC as it applies to ACC Cover Plus (the standard, default option for self-employed people).

Why pay ACC?

ACC provides you with medical treatment if you’re injured through an accident.  Where the injury causes you to be unable to work, ACC provides an income until you’re able (or deemed to be able) to work more than 10 hours per week.

How are your ACC levies calculated?

Your annual ACC levy is charged based on your previous year’s earnings.  When your income is submitted to IRD for the new financial year, your bill is re-assessed.  Similar to income tax, you’re billed provisionally based on your previous year’s earnings.

What should you prove to get paid?

If you lodge a claim, a Case Manager will check that you’re still working as a Real Estate agent. You’ll then need to do some running around to:

  • Prove your financials and financial loss
  • Gain agreement that your injury is due to accident and not degeneration (aging/an old injury).

Having met these requirements, you’re entitled to 80% of last year’s gross earnings, paid weekly, net of tax.

What are the ‘red flags’?

  •  First year on the job? Without financials to prove earnings, it’s difficult for ACC to pay
  • Dialled down your declared earnings? If your declared earnings are less than what you actually earn (e.g. due to financial expenses), your ACC payment will follow suit, paying 80% gross of declared rather than actual income
  • Not working before your injury? During the claim assessment process, your Case Manager may conclude that you haven’t actively worked as a Real Estate Agent in the four weeks prior to your injury. If this is the case, you may not get paid at all
  • Having a boomer sales period? If you’re doing substantially better in the year of your injury than in the previous year, your ACC compensation will be limited to last year’s income
  • It’s not a clear-cut accident? If ACC deems the severity of your injury to be based on degeneration, they don’t have to compensate you
  • Able to return to work in a limited capacity?  After an injury is signed off as able to withstand more than 10 hours’ work per week, this starts an abatement process where ACC will reduce compensation by the hours they assess as being fit for work.

How can you ‘get closure’ on your ACC?

In Real Estate, having a mutually agreeable contract is key and ACC can operate on this same basis.

To give you certainty, both on what you pay in levies and what you’re entitled to receive, the first thing to do is to get an agreed value ACC contract, i.e. ACC Cover Plus Extra.  For a similar or lower price to what you currently pay, an ACC Cover Plus Extra contract can:

  • Give you certainty on the amount you’d be paid on claim
  • Get your claim paid sooner. Because the sum is agreed, there’s no need to prove your financial loss or earnings at claim time
  • Let you focus on recovery. Agreed value contracts pay the agreed sum until 100% of the pre-accident hours are reached.

How can you get maximum income replacement?

Your biggest asset is you; your ability to earn.  Because the amount of accident cover is agreed, ACC Cover Plus Extra typically costs less than a standard ACC Cover Plus contract.

This can free up funds previously committed to accident-only cover, to covering you for illness as-well, giving you clarity on degenerative injuries.  This cover is available through Income Protection Insurance.

If you already have Income Protection Insurance and you’re paying under the default ACC (Cover Plus) option, you may be doubling up on your cover and paying much more than you need to.

Get a professional assessment

Most of us would never sell a house without consulting an agent that we deem to be an expert in the local market.

Similarly, many experienced insurance brokers charge nothing for their advice and may save you thousands. By receiving specialised advice to ensure that your ACC and personal insurance work together, you put yourself and your loved ones in a prime position to get back on your feet sooner.


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