A rugby injury and a claim he didn’t know he could make

Recently a young client was referred to us by his employer. He was just starting out, had never had financial advice before, and wanted some help setting goals and putting a plan in place for the future.

Like a lot of young people, insurance wasn’t something he had spent much time thinking about. But at Castle Trust we believe that before you build wealth, it’s worth protecting what you’ve already got — and, more importantly, your ability to earn an income. So putting some protection in place became the first step in his plan.

Not long afterwards, he hurt his shoulder playing rugby.

Thankfully, ACC was there to help with his treatment and recovery, as it should be. But when our adviser Anna-May heard about the injury, she got in touch to see how he was getting on. During that chat, she realised the injury might qualify under his Specific Injury Cover and encouraged him to lodge a claim.

The interesting part? The client had no idea they could claim. A short time later the claim was approved, and around $9,000 was paid straight into his account

What ACC doesn’t cover in New Zealand

ACC does a genuinely fantastic job. If you’re injured in an accident, it helps with treatment, rehabilitation and some of your lost income. But it was never designed to make you financially whole, and there are some important gaps worth understanding.

It only replaces part of your income.

If you can’t work because of an injury, ACC generally pays weekly compensation of around 80% of your pre-injury income, up to a maximum. That missing 20% might not sound like much — until it’s your mortgage, your power bill and your groceries coming out of it every week.

It usually doesn’t cover your first week off.

If your injury happened outside of work, ACC doesn’t pay for the first week you’re off. Your employer pays that first week only if you were injured at work; otherwise you’re relying on sick leave, annual leave or your own savings to bridge the gap.

It reduces if you have other income.

If you’re earning anything else while you recover, ACC can reduce your weekly compensation accordingly.

None of this is a criticism of ACC. It’s simply that ACC was built to do one job, and a comprehensive insurance plan is built to do another.

Where insurance fills the gaps

This is where the right cover quietly does its work. Income protection can help replace more of your earnings if you can’t work — including in situations ACC doesn’t touch, like illness, health conditions, and a wide range of life situations outside ACC’s scope. Specific Injury Cover, the type the client held, can pay a lump sum for defined injuries such as a broken bone or a torn ligament, on top of any ACC support. For active people in particular, that combination can make a real difference at exactly the moment money gets tight.

The amounts and conditions depend entirely on the policy and your circumstances, which is why it pays to have someone look at your specific situation rather than guess.

The real lesson from this clients story

Here’s what we love most about this clients story: the value wasn’t only in the policy. It was in having a team that knew him, understood his situation, and made sure he received what he was entitled to. Left to chance, that $9,000 would simply never have been claimed.

Because sometimes the best financial plans aren’t about growing your money at all. They’re about making sure life’s setbacks don’t knock you off course.

If you’re not sure what your own cover would – or wouldn’t – pay out, that’s exactly the kind of thing worth checking before you need it.

Book a free chat with a Castle Trust adviser, and we’ll help you understand where you’re protected and where the gaps are.

Worth knowing

A payout like this sits completely separate from ACC and won’t reduce or delay any ACC support you’re entitled to.

Frequently asked questions

What does ACC not cover in New Zealand?

ACC covers injuries from accidents, but not everything that follows. It generally replaces only about 80% of your income, doesn’t pay for your first week off work if you were injured outside of work, and doesn’t cover illness or most gradual health conditions at all.

Does ACC cover illness or just injury?

ACC covers injury from accidents, not illness. Conditions such as cancer, heart disease and most sickness-related health problems are not covered, which is why many New Zealanders pair ACC with mortgage or income protection insurance.

How much of my income does ACC replace if I can’t work?

ACC weekly compensation is generally about 80% of your pre-injury income, up to a set maximum. That leaves a gap of at least 20%, and more if you earn above the cap.

What is Specific Injury Cover?

Specific Injury Cover is a type of insurance that can pay a lump sum if you suffer a defined injury, such as a fracture or a torn ligament. It can pay out alongside ACC support, and is often overlooked by younger, active people. What it pays depends on the policy and the injury.

Do I still need insurance if I have ACC?

For many people, yes. ACC is a strong foundation, but it doesn’t replace all of your income, and doesn’t cover illness. Insurance is designed to fill those gaps. A Castle Trust adviser can help you work out what’s right for your situation.