In this live webinar, James Blair and Euan Jones breaks down ACC vs income protection so you can understand what actually pays you when life throws a curveball.
Why Protecting Your Income in 2026 Matters
A good financial plan has three core parts: where you want to go, how you grow your money, and how you protect what you have. This session focuses on the protection side – because when something unexpected happens, it can derail everything else.
Insurance exists to protect your biggest asset: you and your ability to earn. We outline three key types of personal cover:
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Life insurance – provides a lump sum if you die and others depend on you.
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Health insurance – helps you skip long public-health queues and get treated faster.
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Income protection / ACC – replaces income if you can’t work because of sickness or injury.
For this webinar, the spotlight is on income – because your mortgage, bills, and lifestyle don’t stop just because you do.
Understanding ACC vs Income Protection
Many people assume ACC will always cover them. But ACC only pays when the issue is an accident – not illness, not wear-and-tear, and not most long-term conditions. It must be an acute injury caused by an accident, like falling off a ladder or breaking a leg.
If your problem is illness, mental health, long-Covid, or a degenerative condition, ACC will not pay. That’s where income protection comes in.
For self-employed people, ACC has two main options:
Standard ACC Cover
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Pays 80% of last year’s taxable income.
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You must prove loss of earnings at claim time.
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Payments can be reduced if your business still earns money or if ACC says you can return to work part-time.
Cover Plus Extra
- You choose an agreed income amount (e.g. $80,000 or $100,000).
- No proof of earnings required when you claim – only a doctor’s note.
- You keep receiving full compensation even if your business still earns income or you return to work part-time.
This gives self-employed people far more certainty and control when they need it most.
The Hybrid Option
Some people reduce their ACC Cover Plus Extra down to the $40,000 minimum and use the levy savings to buy private income protection, which covers illnesses and other situations ACC won’t. This spreads risk and widens protection beyond accidents alone.
How Lighthouse Thinks About Protection
Lighthouse doesn’t believe in selling people more insurance than they need. Instead, the focus is on a few simple questions:
- What happens to your household finances if you can’t work?
- What happens if a partner or family member dies?
- How long could you wait in the public health system before it starts hurting your income?
- How much can you self-insure using savings or investments?
Cover should also be reviewed as life changes – paying down debt, building savings, or becoming less financially dependent means you can often reduce insurance over time.
Key takeaways
- ACC only pays for accidents, not illnesses or long-term wear and tear.
- Cover Plus Extra gives self-employed people more certainty, with agreed income and fewer reductions.
- A hybrid ACC + income protection approach can protect against accidents and illnesses.
- Reviewing your cover regularly helps avoid overpaying or being under-insured.
- Protecting your income is a core part of any long-term financial plan.
Next steps:
Book a complimentary discussion with a Lighthouse insurance adviser to review your ACC and income protection options and see what fits your situation.
If you’d like to watch more, check out these other episodes below.
For a no obligation discussion to see how we can help you on the path to wealth, please contact us.
Disclaimer:
The information in this article is general information only, is provided free of charge and does not constitute professional advice. We try to keep the information up to date. However, to the fullest extent permitted by law, we disclaim all warranties, express or implied, in relation to this article – including (without limitation) warranties as to accuracy, completeness and fitness for any particular purpose. Please seek independent advice before acting on any information in this article.
