ACC is Aotearoa’s largest government-run insurance company that we have access to and pay levies for. In 2022 alone, ACC paid out approx. 4.9 billion dollars in claims.

It’s something we all must pay to be a part of – so if / when it’s your time to make a claim, you want to ensure you’re making the most of your entitlements and getting maximum value.

There’s a few-fish hooks all contractors and self-employed should be aware of:

1.      50% of people may have been, or are currently, on the wrong classification unit (e.g., occupation code). So what? Well, if you own a plumbing business and have a 50% shareholding with your spouse, the default ACC code would be that of a plumber (even if your spouse is on administrative duties). ACC doesn’t have the resource to check everyone is on the correct code, meaning you could be paying more in levies simply by being on the wrong code.

2.      The default ACC scheme is not as favourable for self-employed or sole traders. There is a scheme known as ACC Cover Plus Extra which has multiple benefits, including a pre-agreed cover amount with no need to prove your loss of earnings at claim time. The benefit amount also continues to pay your full weekly entitlement, even if you return to work part-time or if the business is still generating income.

3.      As a self-employed person or sole trader, if you can’t work, either due to injury or illness for an extended period of time, your income stops. ACC covers us for accident-related events only, so if you are off work because of an illness, it doesn’t provide any income support, which is the key reason self-employed people take out private insurance to cover these gaps.

It's easy to change across to ACC Cover Plus extra, and you may also be able to save some money on your levies, depending on a few factors such as the amount of cover you choose, and your occupation code. There are very few scenarios whereby ACC Cover Plus Extra is not favourable for self-employed or sole traders.

If you’d like to have a chat about how we can help, or if you have any questions, please feel free to contact us: hello@solutionsfinancial.co.nz or by phoning Luke on 021 027 97827.

Please note this information is general in nature and should not be taken as personalised financial advice. We recommend you should seek appropriate personalised advice to suit your individual circumstances.