Mental Health Now Causes 32% Of Income Protection Claims As Back Injuries & Burnout Top Reasons NZers Can’t Work

Mental health conditions now account for 32% of income protection insurance claims – significantly higher than the 20% industry average – according to new claims data analysis published by personal finance research website MoneyHub. The research reveals that depression, anxiety, burnout, and stress-related conditions are among the most common reasons working New Zealanders find themselves unable to earn an income.

The analysis, based on claims data from one of New Zealand’s largest independent insurance advisers covering the 12 months to December 2025, shows that musculoskeletal injuries remain the leading cause of claims at 38%, but the rapid growth of mental health claims reflects a workforce under increasing pressure.

Key findings from the analysis include:

• Mental health claims surging: 32% of all income protection claims – depression, anxiety, burnout, and PTSD are legitimate reasons people cannot work
• Musculoskeletal injuries lead: 38% of claims from back injuries, broken bones, joint problems, and workplace accidents
• Average claim duration: 4–6 months, with cancer and serious mental health claims extending to 2+ years
• Average monthly benefit: $5,400 per month – costing policyholders an average of just $115 per month in premiums
• Self-employed dominate: 60% of policyholders are self-employed – no employer sick leave, no government safety net
• Claims rarely declined: Industry-wide 5–8% decline rate, almost always for non-disclosure
• Average age at purchase: 41 years – most people buy in their late 30s to early 40s when mortgages and families make the risk real

“Income protection is arguably the most underrated insurance product in New Zealand,” said Christopher Walsh, Founder of MoneyHub. “You are far more likely to be temporarily unable to work than you are to die during your working years. A back injury, a mental health crisis, or a cancer diagnosis can leave you without income for months – and that’s exactly when the bills keep coming.”

Walsh highlighted the value proposition: “The average premium of $115 per month buys $5,400 per month in benefits if you need to claim. That’s a 47:1 ratio of potential benefit to cost. Few other insurance products offer that kind of leverage. And ACC only covers accidents – if you can’t work due to illness, ACC pays nothing.”

The full analysis, including claims breakdowns, policy structure guidance, and underwriting data, is available in MoneyHub’s guide: Income Protection Insurance Claims Statistics NZ

Data Source: Claims data from one of New Zealand’s largest independent insurance advisers (January–December 2025), combined with industry-wide statistics from insurance industry bodies and insurer publications.

About MoneyHub

MoneyHub is New Zealand’s leading independent financial guidance website, offering free research, tools, and guides to help New Zealanders make better money decisions.

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