Bunnings Trade

Sign in or sign up

No PowerPass account? Sign up

Job list

Sign in to your account

Two construction workers looking at a tablet device while on a construction site

There’s a bit of confusion around health insurance and income protection. Sometimes they’re seen as much of a muchness. Not so! For starters, health insurance covers treatment costs. Income protection replaces your income if you can’t work. Sounds simple enough, but then what about public health? And isn’t that why we have the Accident Compensation Corporation (ACC)?

The thing is, ACC only covers accidents. Income protection replaces income if you can’t work because of an accident or illness, including mental health. Surprisingly, builders are more likely to miss work due to illness than accidental injury. So, income protection can be better than solely relying on ACC. Additionally, self-employed people can dial back their ACC cover and put the saving towards income protection insurance, leading to broader cover for the same price. There are pros and cons though, so it’s a good idea to discuss it with an independent financial adviser.

Unlike ACC and income protection, health insurance won’t replace your income. It only covers the cost of treatment. People do rely on the public health system for this, but health insurance may mean faster access to private treatment. It can cut down the cost of private treatment, too. The guts of it is, taking only income protection means relying on the public health system for treatment if you get sick, but receiving regular payments to replace your income until you’re back at work.

If you just take health insurance, you might receive treatment sooner. But if you can’t work and have no source of income, you rely on disability income support from WINZ (currently just over $60 a week).You could choose both or a combination of the two, like income protection for yourself and health insurance for the kids. At the end of the day, running it by an experienced adviser before you make a call is the way to go.

Builtin Insurance are New Zealand’s trade insurance experts. For more information and to request your own review visit builtininsurance.co.nz or contact Dave La Pere at dave.lapere@builtin.co.nz or 0800 BUILTIN.