The short answer
Your runway is how long your household could pay its bills with no income from you. It is built from sick leave, annual leave and accessible savings, measured against your monthly outgoings.
It matters because the income protection wait period you choose is the single biggest lever on your premium. Buying a four-week wait when you have four months of runway means paying every month for cover you would never use.
Last reviewed 2026-07-30
Your numbers
Your runway
What the result is telling you
Two things. First, how exposed you are — and whether a long illness is an inconvenience or a crisis. Second, which wait period you should be quoting on, which is where the money is.
Two things this deliberately does not assume
- That ACC will pay. It will not, if the reason you cannot work is illness. That is the entire premise of this page. See what ACC does not cover.
- That your outgoings stay the same. They usually rise during a serious illness — travel to treatment, parking, help around the house, a partner reducing hours. The runway above is, if anything, optimistic.
The wait period should be a decision. For most people it is an accident.
Sizing the benefit
New Zealand income protection is typically capped at around 75% of income. The insurer is not being stingy — a policy that replaced 100% would remove any financial reason to return to work, and regulators and insurers both take a dim view of that.
What it means practically is that even fully insured, there is a gap. Which is one of the arguments for holding some trauma cover alongside: a lump sum that clears part of the mortgage permanently reduces the outgoings the 75% has to stretch across.
Then choose the benefit period
The calculator does not do this bit because it is a judgement rather than a sum, but it is the more important decision. Two years of cover is cheap and handles a survivable problem. The scenario that destroys households is being unable to work again at all — and only a benefit period running to age 65 covers it.
If budget forces a compromise, a longer wait with a longer benefit period is almost always better shaped than a short wait with a two-year benefit. More on how the dials move the premium →
Common follow-up questions
Should I count my partner's income?
Yes — the calculator does, because the honest question is whether the household can pay its bills, not whether you personally can. Where it gets complicated is that a partner often reduces their hours during a serious illness to provide care, so treating their income as fully stable is optimistic.
What if my runway is already long?
Then you are in a good position, and the right response is usually a long wait period and a long benefit period — cheap cover for the catastrophic scenario, self-funding the survivable one. That is textbook use of insurance and it is much cheaper than most people expect.
Does this account for a mortgage holiday?
No. Lenders will sometimes grant a repayment holiday or interest-only period during illness, which genuinely extends your runway — but it is discretionary, it accrues interest, and it is not something to plan around. If your bank has confirmed one in writing, you can add it to savings.
Keep reading
This page is general information about how insurance works in New Zealand. It is not regulated financial advice and it does not take your situation into account. For advice about your own cover, talk to a licensed financial adviser.