Data release
ACC raised its funeral grant faster than the weekly payment injured people live on
Source: ACC, Changes to ACC client payments from 1 July 2026
From 1 July 2026 ACC lifts its one-off payments 3.08% to keep pace with prices, and the weekly income payment only 1.97%. Anyone past six months on a claim now buys about 1.08% less, and no rule in the scheme ever pays that back.
By Henry Smith · ACC · 2026-06-11
What this means for you Anyone ACC has paid weekly compensation for more than six months buys about 1.08% less from 1 July 2026. There is no catch-up rule, so that loss is permanent. The payment cap starts to bite at roughly $160,300 of income, and at $300,000 nearly half of the promised 80% is not covered at all.
If ACC has been paying you weekly compensation for more than six months, your payment now buys less than it did a year ago. From 1 July 2026 ACC lifts its one-off payments, the funeral grant among them, by 3.08% to keep pace with prices. It lifted the weekly payment injured people actually live on by 1.97%. For someone on ACC's maximum, that gap is about $27 a week, roughly a top-up grocery shop, gone every week from here on. And there is no catch-up rule. Next July's rise, whatever it turns out to be, gets applied on top of this year's lower figure (ACC, 11 June 2026).
What this means if you are on a claim
Past 26 weeks, the income you live on has been reset to a slightly lower level for the rest of the claim. It is not a one-year dip that later corrects. Recovery from a serious injury is measured in years, so the people carrying this are the ones least able to work around it by asking for a raise or picking up hours. If your claim is younger than six months, none of it touches you yet: your payment is still set from what you were earning just before you got hurt.
Why are there two different numbers?
Weekly compensation is the money ACC pays to replace your income while an injury keeps you off work, and it covers up to 80% of what you earned before the injury, before tax (ACC). Once a claim passes 26 weeks, ACC lifts it each 1 July by the March Labour Cost Index, the Stats NZ measure of how fast pay rates are rising. So it tracks wages. The one-off payments, meaning the Independence Allowance, the lump sums and the funeral and survivor's grants, are lifted by the March Consumers Price Index instead, which measures what households pay for everyday goods and services.
In 2026 those two measures came apart: 1.97% against 3.08%, a difference of 1.11 percentage points. Every payment that arrives once kept up with prices. The payment people live on did not. The two rates sit a few paragraphs apart in ACC's announcement, which never sets them side by side. Its own figures do.
| Payment | 1 July 2025 | Rise applied | 1 July 2026 |
|---|---|---|---|
| Funeral grant | $7,990.30 | × 1.0308 (prices) | $8,236.40 |
| Survivor's grant, partner | $8,566.62 | × 1.0308 (prices) | $8,830.47 |
| Maximum weekly compensation | $2,418.55 | × 1.0197 (wages) | $2,466.20 |
Sources: ACC's 2025 rates announcement, 16 June 2025, and the 2026 announcement cited above. Each 2026 figure is the 2025 figure times the rise, to the cent. Survivor's grants for children under 18 and other dependants rose with prices too, to $4,415.25 each.
Had the weekly maximum risen with prices as well, it would now be $2,493.04 rather than $2,466.20. That difference is the $27 a week in the opening line.
Will next year's rise fix it?
No. The gap does not have to repeat to be permanent. It only had to happen once, because every future rise is worked out from the lower base.
It has not always run this way. In 2024 and 2025 the wage-linked rise ran slightly ahead of the price-linked one, by 0.12 and then 0.36 percentage points. The 2026 round wiped out both of those small gains at once and kept going. Across all three rounds, weekly compensation is up 9.26% while the price-linked payments are up 9.94% (ACC's 2024 announcement, set against the 2025 and 2026 announcements cited above). Someone paid through all three now sits 0.61% behind prices, and the whole of that shortfall opened up this year.
Chart: the adjustments ACC applied at each 1 July round, taken from the three ACC announcements cited above.
What if you earned more than $160,300?
ACC promises to replace 80% of your pre-injury income, but the $2,466.20 weekly maximum puts a ceiling on that promise. On a steady wage the ceiling takes full effect at about $160,303 a year. Earn more than that and ACC replaces none of the extra.
| Earnings before the injury | Share of income ACC replaces | Slice of the 80% promise missing |
|---|---|---|
| $160,303 | 80.0% | 0% |
| $180,000 | 71.2% | 10.9% |
| $200,000 | 64.1% | 19.8% |
| $250,000 | 51.3% | 35.9% |
| $300,000 | 42.7% | 46.6% |
QuoteHub arithmetic on ACC's published $2,466.20 maximum, assuming the same pay every week of the year. The $160,303 line is the income at which 80% of your pay first hits the cap.
The missing slice grows fast. At $300,000 of income before the injury, almost half of the promised 80% simply does not exist. And the cap itself rose by only 1.97%, so it is losing buying power along with every payment beneath it.
What if ACC pays you late?
The quietest line in the announcement may be the most expensive for one group. When ACC pays weekly compensation more than a month late, it pays interest on the money it owes. From 1 July 2026 that rate falls from 5.78% to 4.413% a year (ACC), a 23.7% cut in the rate itself. Two years ago, in ACC's 2024 announcement, it was 6.967%, so money ACC owes you now earns 36.7% less interest than at that peak. The claims that build up large backdated sums are the long-running, disputed ones, which means this cut lands on much the same people taking the 1.97%.
What does this mean for your cover?
If you earn under roughly $160,300 and your injury is an accident, ACC's 80% replacement is still a strong first layer. This announcement is about its edges, and there are two worth knowing. The first is the slice above the cap, which ACC replaces nothing of. The second is larger: ACC is an accident scheme, so it pays nothing for illness, at any income. A cancer diagnosis costs you the same payslip as a fall off a ladder, with none of the payments on this page attached. Private income protection exists for both gaps, and trauma cover pays a lump sum on diagnosis whether or not ACC is involved.
Read the survivor's grants the same way. The $8,830.47 partner grant is paid once, and only if the death is accidental (ACC). It is not sized to a mortgage or to years of household income. That sizing job is what life insurance is for.
What could we not check?
ACC says the two rises come from the March 2026 wage and price indexes, but it does not name the exact Stats NZ series or publish the index numbers. We did not check 1.97% and 3.08% against Stats NZ. They are the rates ACC says it applied, which is what injured people actually receive, but we take the maths behind them on trust.
There is a fair argument against our framing. Weekly compensation replaces a wage, so tying it to a wage index means injured people do as well, or as badly, as the workers they used to be, and 2026 was simply a year in which pay trailed prices for everyone. The counter is that a worker can ask for a raise, change jobs or pick up hours, and someone on a claim cannot. The index is the whole of their outcome. Both readings fit the numbers above.
ACC does not say how many of its clients are past 26 weeks, so we cannot say how many people this affects. Our $160,303 line assumes the same pay every week of the year, and ACC works out earnings differently for the first four weeks, for people whose pay varies and for the self-employed, so the cap bites at a different point on different claims. We could not confirm the publication date of the 1 July 2024 announcement, so its figures are cited without one. And ACC does not show how it arrived at the 4.413% interest rate.
What this means for your cover
ACC pays for accidents, not illness, and it stops at a published ceiling. Income protection is the cover that answers both. Income protection in New Zealand
Sources
Every source below was read and checked on 21 August 2026.
- Changes to ACC client payments from 1 July 2026, ACC, 11 June 2026
- Changes to client payments from 1 July 2025, ACC, 16 June 2025
- Changes to client payments from 1 July 2024, ACC
- Calculating weekly compensation for employees, ACC
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Explore related pages: Life Insurance, Income Protection, Health Insurance, Trauma Insurance, Referral.