Greens want ACC extended to cover sickness

A Green Party policy could mean less demand for income protection insurance from insurers.

Tuesday, July 7th 2020, 6:00AM 5 Comments

James Shaw, Green Party Co-leader

As part of the announcement of its tax policy, the party said it would extend the ACC scheme to cover lost earnings from illness – not just accidents, as is currently the case.

Payments would be made at up to 80% of a worker’s salary or 80% of the full-time minimum wage, whichever was higher.

People are more likely to be off work for an extended period through illness than injury but most cannot qualify for a benefit if they live with a partner who is in work.

That gap has been something that private insurers have sought to provide New Zealanders with cover for.

But Financial Services Council chief executive Richard Klipin welcomed the proposal.

“New Zealand has a significant problem with underinsurance and ensuring that we are protected when that rainy day hits, so it’s positive to see a policy that considers how to support Kiwis when the unexpected happens. We look forward to discussing the proposal in more detail with the Green Party and in particular the role that private sector providers can play in ensuring all New Zealanders have the insurance cover that they need.”

This is not the first time the suggestion has been made.

In 2018, former prime minister Sir Geoffrey Palmer told Victoria University that drawing a line between injuries and other medical issues could be difficult and unfair.

A “single unified system” would end unjust discrimination, he said.

ACC Minister Iain lees-Galloway didn’t discount the idea but said it would require considerable public debate.

Partners Life founder Naomi Ballantyne said at the time it would disrupt but not destroy the insurance market.

If the Government decided to offer illness cover on ACC, there would be nothing to stop a future government reversing that decision.

People who had since developed health conditions then might not be able to get cover for them.

Tags: ACC Income Protection insurance Partners Life

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Comments from our readers

On 7 July 2020 at 8:31 am Backstage said:

This is a ridiculous proposal and the cost would be unbelievable. ACC has many other benefits aside from just income and the 2 events, illness and injury should not be wrapped together in ACC. Other services that provide for illness should be reviewed first before wading into this. For those who havent been self employed and had to pay ACC levies this may appear like a good proposition but it isnt!

On 7 July 2020 at 12:27 pm Advice4Life said:

What about making all personal and business insurance premiums tax deductible with benefits non assesable. Or offer a tax discount, maybe 1% for families who prove they have private health insurance to reduce burden on public health. Been happening in Australia for decades and succesful.

Greens stick to your knitting, your financial incompetence is very amusing.

On 9 July 2020 at 4:54 pm LNF said:

The Greens have no idea
The purpose of the Woodhouse report was to remove the "at fault" component of accidents
Sickness doesn't have that
Do the Greens intend to make private healthcare part of this as it is with accidents
Simply income relate the sickness benefit and remove all the additional fishhooks
They haven't thought it through. They are green

On 10 July 2020 at 3:59 pm All hat no cattle said:

Never happen.
The Greens are such an aspirational bunch. Must all the weed.

They 'want' all sorts of unlikely things.
Like a new train to AKL airport, legal weed, or KiwiBuild houses for low income families, or the conversion much productive land from arable farming to growing trees.
Then there are the things so preposterous they have never happened and remain completely unlikely - such as population control, or a seat at the table of Cabinet. Or even less likely; extending ACC as per the above.

On 31 July 2020 at 11:40 am RS said:

Again, it's not ever about championing the concept of personal responsibility, it's cut straight to the State-ist approach of More Welfare.

They don't get it do they.

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