General FAQs

Income protection insurance is designed to safeguard your income if you are unable to work due to sickness or injury, by replacing your regular income. With this cover, you can continue living life without having to worry about how you will pay for essential expenses like grocery and utility bills, the mortgage or rent, school fees, and car or public transport costs.

OneChoice Income Protection Insurance covers a portion of your income and is available to New Zealand residents aged between 16 – 60, who work at least 15 hours a week either as an employee, a sole trader or are self-employed. You can apply for up to $15,000 per month, up to 75% of your income, to help with taking care of your expenses and maintain your lifestyle, while you recover.

Income protection insurance could be worth considering if you rely on your income to cover your day-to-day expenses – such as bills, mortgage or rent, groceries, or even school fees. If you earn a wage or salary, are self-employed, or a small business owner, income protection insurance can help you meet your financial needs and maintain your lifestyle by providing you with monthly benefit payments if you’re unable to work due to sickness or injury.

While the New Zealand Government’s ACC program can cover medical costs for specific injuries resulting from accidents, as well as provide income support, it doesn’t cover all injuries and it generally doesn't cover sickness. With 63% of Kiwis being very concerned about not being able to cover emergencies or unexpected costs, income protection may be worth considering for peace of mind that you can continue to have an income if you are unable to work due to sickness or injury.

You can cover a portion of your income, up to 75%, and up to $15,000 per month with OneChoice Income Protection Insurance. However, everyone is different, with different income and lifestyles, and the amount of income protection insurance you need can depend on factors such as the amount of sick leave you have, how much income you’re earning, how much of it you spend on expenses (mortgage or rent, groceries, phone, electricity, and water bills), plus any other obligations you have.

Income protection insurance protects your income if you are unable to work temporarily because of sickness or injury. This means you can get paid monthly benefit amounts that you can use in any way that you see fit, while you recover. This could include any living expenses, like mortgage or rent, as well as enjoying your usual lifestyle – it’s completely up to you.

Mortgage protection insurance is a type of cover that you can get to protect your mortgage repayments. So, if you are sick or injured, your mortgage repayments will be paid by your insurance provider for a certain period of time.

But remember, with income protection insurance, you can use your monthly benefits not just to cover your mortgage but to also meet other financial commitments, including any medical bills related to your sickness or injury.

ACC stands for Accident Compensation Corporation. It's a New Zealand government agency that provides compulsory insurance cover for specific personal injuries. It can help cover the cost of some of your medical and rehabilitation costs and provide weekly payments if you are injured because of an accident and can’t work as a result. You may be eligible for weekly compensation of up to 80% of your income if you are unable to work due to an injury the ACC is already covering. However, ACC generally doesn’t cover sickness or illness except in some very specific instances.

Income protection insurance, on the other hand, is a type of insurance that helps to safeguard your income if you are unable to work due to sickness or injury. Injuries that may not be covered by ACC could be covered by income protection insurance. You can use the monthly benefits you receive in any way you see fit. You can use the money to pay for the rent or mortgage, food, clothes, utilities, other essentials and things that make life fun, like subscription services or treating your family to a day out – same as you would normally spend your regular income.

Income protection insurance premiums can be tax deductible, according to the Inland Revenue Department (IRD).¹ You can claim the cost of the premiums you’ve paid against any loss of income as a tax deduction, whether you are an employee or self-employed. But remember, if you receive a monthly benefit payment to replace your wages or salary under an income protection policy, you may need to include it in your tax return as a source of income. Seek professional advice when evaluating the tax implications of OneChoice Income Protection Insurance.

Yes, income protection insurance can cover those who are self-employed, contractors, or sole traders – any New Zealand residents aged 16 – 60 working at least 15 hours a week can apply for OneChoice Income Protection Insurance.

The monthly benefit you receive will be worked out using your pre-tax income, which may be calculated a little differently to someone who is an employee. Your share of annual income earned in the business before tax, directly due to your own personal efforts, minus any business expenses and super contributions will give you your pre-tax income.

Income protection insurance can cover mental illness, but every insurer is different so be sure to do your research before finalising your policy.

If you are diagnosed with a mental health issue that prevents you from working, after you take out your policy with OneChoice, then your income can be covered. However, if you were diagnosed prior to taking out your policy, mental health would not be covered as it would be seen as a pre-existing condition.

It’s important to read the policy document to determine if a policy will cover redundancy.

With OneChoice, you may be able to claim a redundancy premium waiver benefit. This means that OneChoice will cover the cost of premiums for 3 months (or 7 fortnights for those who pay fortnightly), ensuring your policy remains in place and you are still covered if you need to make a claim. You will need to provide a letter from your employer confirming that you have been made redundant, if you would like to access the redundancy premium waiver.

GST can be charged on income protection insurance premiums. The reason for this is because the monthly benefit you will receive if you are sick or injured is considered goods and services. You may be able to claim it back if you are GST registered, for example, as a sole trader or self-employed business owner. Speak to a qualified financial or tax adviser to find out what you can claim on.

The duties you perform as part of your job can affect the premiums you pay. For OneChoice Income Protection Insurance, premiums are impacted by a range of factors including the duties you perform as part of your work, your age, gender, and smoking status.