The Accident Compensation Corporation (ACC) () is the New Zealand Crown entity responsible for administering the country's no-fault accidental injury compensation scheme, commonly referred to as the ACC scheme. The scheme provides financial compensation and support to citizens, residents, and temporary visitors who have suffered personal injuries.
The corporation was founded as the Accident Compensation Commission on 1 April 1974 as a result of the Accident Compensation Act 1972. Its principal governing act today is the Accident Compensation Act 2001. As a Crown entity, ACC is governed by a board that is responsible to the Minister for ACC. Unlike most other Crown entities, it has its own dedicated ministerial portfolio, which since February 2025 has been held by Scott Simpson.
History The ACC has its origins in the Workers' Compensation for Accidents Act 1900, which established a limited compensation scheme for workers who had suffered injuries where there was no directly responsible party. In 1966, a New Zealand Royal Commission, chaired by High Court judge Owen Woodhouse, was established. In 1967 the Royal Commission recommended extending this compensation to cover all injuries on a no-fault basis. Following this report, the New Zealand Parliament passed the Accident Compensation Act 1972, later amended in 1973. The Accident Compensation Commission was established from 1 April 1974. In 1992, the commission was renamed the Accident Compensation Corporation (ACC), as a short form for its official name Accident Rehabilitation and Compensation Insurance Corporation[ http://www.nzlii.org/nz/legis/hist_act/aracia19921992n13471.pdf ACC Act 1992] (part IX) The Act was later replaced by the Injury Prevention, Rehabilitation and Compensation Act 2001, which was in 2010 renamed the Accident Compensation Act 2001. The Commission's annual report for 1989/90Annual Report (1989/90) of the Accident Compensation Commission, p.5 proposed that the distinction between accidents—which are coveredsee Fenton v. Thorley WN 149 for an old definition—and "illness"—which is not—should be dropped. This proposal was not taken up by the government.
From 1 July 1999, the fourth National government allowed private insurance operators to provide work-related accident insurance, and ACC was briefly exposed to competition. The fifth Labour government (elected in November 1999) repealed this change, and as of 1 July 2000 re-instated ACC as the sole provider of accident insurance coverage.
On 30 May 2025, ACC chair Tracey Batten resigned effective immediately. In March 2024, the sixth National Government had renewed a chairmanship for a further three-year term until 2027.
Features ACC is the sole and compulsory provider of accident insurance in New Zealand for all work and non-work related injuries. The corporation administers the ACC Scheme on a no-fault basis, so that anyone, regardless of the way in which they suffered an injury, has coverage under the scheme. Due to the scheme's no-fault basis, people who have suffered personal injury do not have the right to sue an at-fault party, except for exemplary damages.see, Donselaar v Donselaar 1 NZLR 97, confirmed by Auckland City Council v Blundell 1 NZLR 732. As of July 2026, the scheme does not cover injuries received by volunteer firefighters in their service in relation to mental injuries received due to trauma, to the same extent as their paid firefighters.
However, the Accident Compensation Act 2001 defines "personal injury" in a manner that restricts the concept of injury to physical injury or a mental injury due to a physical injury. Only mental injury caused by sexual assault has been excluded from the definition of personal injury and the claimant does not have to prove physical injury
The scheme provides a range of entitlements to injured people, however 93.5 percent of new claims in 2011 to 2012 were for treatment costs only. Other entitlements include weekly compensation for lost earnings (paid at a rate of 80% of a person's pre-injury earnings) and the cost of home or vehicle modifications for the seriously injured. The scheme offers entitlements subject to various eligibility criteria. ACC works with partners and communities on initiatives to prevent injuries. These initiatives include "RugbySmart" with New Zealand Rugby, "Ride Forever", "Mates and Dates", and "Make Your Home a Safety Zone" with Safekids Aotearoa.
It is claimed that the system encourages clinicians to report mistakes. The cost of litigation to the health system is considerably less than in some other countries.
Alternative therapies ACC has been criticised for providing funding for several alternative therapies that are unsupported by scientific evidence, including acupuncture, osteopathy and chiropractic interventions.
Funding ACC is primarily funded through a combination of levies and government contributions. Income collected from each source goes into predetermined accounts based on the source. Costs relating to an injury are paid from one of these accounts based on the type and cause of the injury.
The four main accounts are: Work, Earners, Non-Earners, and Motor Vehicle. There is also a fifth account: Treatment Injury (formerly Medical Misadventure), that draws on both the Earners and Non-Earners accounts.
Levy rates were most recently approved by Cabinet in November 2021 after a final recommendation from ACC Minister Carmel Sepuloni, for the 2022/23, 2023/24 and 2024/25 levy periods. Levy periods run from the to the the following year.
Account Types of injury covered Income sources Work Work-related Levies collected from employers and self-employed people. The amount payable averages 0.63% of an employer's payroll or income earned (), though rates vary depending on the employer's industry and risks associated with it. Earners Non-work-related, by income-earners Levies collected in conjunction with tax deductions on income. Paid by employees through PAYE or by self-employed people directly. The amount payable is 1.39% of income earned (). Non-earners Non-work-related, by non-income-earners (i.e. children, the elderly and unemployed, visitors) Government contribution from the general taxation pool. Motor Vehicle Relating to motor vehicles on public roads Levies included in the price of petrol (not diesel or LPG), and through motor vehicle license fees. The levy on motor vehicle license fees averages $113.94 (GST-exclusive) per vehicle per year (), with motorcycles and heavy vehicles paying more than average due to the increased likelihood of injury associated with these modes of transport, and the petrol levy is set at 6c per litre (GST-exclusive). Treatment Injury As a result of medical treatment (previously known as medical misadventure) Funded from the Earners and Non-Earners accounts, depending on the clients' employment status.ACC initially had a "fully funded" model whereby sufficient levies were collected to cover the lifetime cost of each injury, which might require compensation over a period of 30 years or more. The scheme was shifted to a "pay-as-you-go" funding model, where the scheme collects enough levies during a year to cover the cost of claims for that particular year, in 1982. The “fully funded” model was restored in 1999. However, getting ACC onto a strong financial footing was not easy and in 2009, ACC posted a $4.8 billion loss—at the time described as the biggest corporate loss in New Zealand's history. This cost escalation is thought to have been due to an increase in the number of claims, a widening of entitlements and increased costs of meeting the claims. Another factor was physiotherapy services being made free at the point of delivery leading to over-servicing of clients. Between 2000 and 2008 this appears to have contributed to an increase in physiotherapy costs of 214%.
The 100% reimbursement scheme for physiotherapist services was ended, and ACC levies on wages and motorists were increased. ACC chairman John Judge told the Sunday Star-Times that it was going to take a "hard-nosed" approach to get ACC into a sustainable position. This would require "substantial" levy increases and "legislative change to get people off the scheme and back to work quicker". By 2012, ACC had made good progress towards its 2019-goal (of being fully funded), and was $4.5 billion short of matching liabilities ($28.5b) with its assets ($24b).
Towards the end of 2012, ACC Minister Judith Collins announced that Government would not cut ACC levies for the 2013–14 year. While the ACC Board and Ministry of Business Innovation and Employment had recommended reducing the levies by between 12 and 17 per cent, Collins stated that the government's decision was motivated by the uncertain economic conditions and a desire to ensure that reductions to the levy were sustainable. Andrew Little, the Labour Party's ACC spokesman, criticised this decision, claiming that it was driven by the government's attempt to bring the budget into surplus and reducing the levy would provide a boost to the economy. In the 2013 budget, Collins announced a $1.3 billion cut in ACC levies over the next two years. Collins said the Earners and Workers accounts were now fully funded after the Corporation reduced the number of long term ACC claimants from 14,000 to less than 11,000.ACC leads good economic news at National party convention NZ Herald 25 May 2013
In 2015/16, ACC's outstanding claims liability (OCL) increased by $6.4 billion, which lead to a net deficit of $3.4 billion. The OCL measures the future cost of all existing ACC claims. That year also saw 1.93 million claims accepted; a 5.2% increase from the previous year. $3.5 billion was paid out to all new and existing claims. There has been some conjecture over whether or not ACC staff were paid incentives to remove long term clients off weekly compensation. This was refuted by Ex-CEO Ralph Stewart in 2012. That year there were 10,400 long-term claimants registered with ACC—down by over 1,000.
In 2019, ACC posted a record $8.7 billion loss.
Investments
ACC invests the premium it collects in various ventures. It has a portfolio of $40b and its investment manager was believed to be the highest paid public servant in New Zealand. Of its top 50 investments, 47 are listed companies in NZ and overseas. Notable exceptions include a 22% shareholding in Kiwibank and the consortiums building Transmission Gully Motorway and the Puhoi to Wellsford Motorway.
ACC has attracted controversy at several junctures since its establishment due to the nature of some its investment decisions. In 2003 Green Party MP Sue Bradford revealed that ACC held investments in brewery industry giants DB Breweries and Lion Nathan, which she claimed contravened ACC's legal obligation to engage in ethical investments to protect New Zealand's global reputation. In 2016 ACC admitted it had indirectly invested in six companies on its own exclusion list, including weapons manufacturer Lockheed Martin and British Tobacco. ACC's ethical investment policy was drawn into question again in 2019, when Green Party MP Chlöe Swarbrick publicly criticised the Crown Entity for continued investment in fossil fuels, arguing that in light of the climate emergency this investment was unethical and that divestment should take place according to the precedent set by its exclusion of investment in tobacco companies.
Cover for the self-employed ACC CoverPlus Extra was introduced by ACC to provide cover for self-employed workers and business owners that would fail to otherwise be covered adequately by the standard ACC CoverPlus policy. It works by paying an agreed level of compensation, in the event of an injury resulting in time off from work.