Most people who buy a home spend a lot of time thinking about the mortgage, the rate, the term, the repayments. What they spend almost no time thinking about is what happens to that mortgage if they can't work.

It's an uncomfortable question. But it's worth asking.

In New Zealand, about 1 in 4 people will experience a period of disability that stops them working for more than 90 days at some point in their working life. That's not a fringe risk, it's a common one. And for most people, their income is the single most important financial asset they have.

What about ACC?

This is the most common misconception I come across. Many New Zealanders assume ACC covers them if they can't work. It does, but only for accidents. If you can't work because of illness, cancer, a heart condition, a mental health crisis, a serious infection, ACC pays nothing.

And here's the thing: the majority of long-term work absences in New Zealand are caused by illness, not accidents. Heart disease, cancer and mental health conditions collectively account for a far greater proportion of disability claims than workplace accidents do.

ACC only covers accidents. If illness stops you working, which is more likely than an accident for most people, you have no ACC support. Your mortgage, your bills, your rent: all of that keeps coming regardless.

What does "can't work" actually look like?

It doesn't have to be dramatic. It's not always a catastrophic event. Often it's:

  • A cancer diagnosis that requires surgery and treatment over 12-18 months
  • A serious mental health episode that makes it impossible to function in your role
  • A heart attack followed by a long recovery period
  • A back injury that means you physically can't do your job
  • Burnout or anxiety severe enough to require extended medical leave

None of these are rare. All of them can stop your income, and your mortgage still needs to be paid.

Your two main options: income protection vs mortgage protection

There are two main types of cover that address this risk. They're different products that suit different situations.

Income Protection

  • Replaces up to 75% of your income if you can't work
  • Covers both illness AND injury (not just accidents)
  • Pays until you return to work, or to a set age
  • More comprehensive but generally higher premium
  • Best for people whose mortgage is one of several expenses

Mortgage Protection

  • Covers your specific monthly mortgage repayment
  • More targeted and often lower cost
  • Pays while you can't work due to illness or injury
  • Specifically designed to keep you in your home
  • Good entry-level option if budget is tight

The right choice depends on your income, your mortgage repayment, and what else you need to cover if you can't work. For most people with a mortgage and dependants, some form of income protection is worth serious consideration.

"Your ability to earn is likely the most valuable financial asset you have. You'd insure your car. You'd insure your house. The question is why so many people don't insure the income that pays for both."

How much does it cost?

It varies based on your age, health, occupation, and the level of cover. But as a rough guide:

  • A 30-year-old in a standard office role might pay $80-$150/month for solid income protection cover
  • Mortgage protection (covering just the mortgage repayment) is typically lower, often $40-$80/month
  • A 40-year-old in a manual occupation will pay more

The better question is: what would it cost if you didn't have it? If your mortgage is $2,500/month and you can't work for a year, that's $30,000 you'd need to find from somewhere. Most people don't have that sitting around.

What I actually look at in an insurance review

When I review someone's insurance situation, I'm not starting from "how much can I sell you." I'm starting from "what would actually happen if you couldn't work for 3, 6, or 12 months?", and working backwards from there.

I'll look at your income, your fixed costs, what existing cover you might have (through work or otherwise), and what the gaps are. Then I'll compare options across the major NZ insurers and give you a recommendation with honest reasoning.

A quick note on employer cover: Many employers provide some form of group income protection. It's worth checking what you have, but group cover often has limitations, doesn't come with you when you leave, and may not reflect your actual income level. I'll review it as part of the process.

The honest bottom line

Nobody wants to think about getting sick or injured. But if you have a mortgage and an income that pays for it, this is exactly the kind of risk that insurance exists for. A 30-minute conversation to understand your options costs nothing. The cost of not having cover when you need it can be everything.