Depression, anxiety, burnout among common reasons why Kiwis are unable to earn
Mental health conditions are driving nearly a third of income protection insurance claims in New Zealand, far outpacing industry norms and underscoring rising pressure on the workforce, new analysis shows.
Personal finance research website MoneyHub has reported that mental health conditions now account for 32% of income protection insurance claims, compared with an industry average of about 20%.
The data, drawn from one of New Zealand's largest independent insurance advisers, covers claims lodged between January and December 2025.
The claims analysis found that conditions such as depression, anxiety, burnout, stress-related illnesses, and PTSD are now among the most common reasons working New Zealanders are unable to earn an income.
Musculoskeletal injuries, including back injuries, broken bones, joint problems, and workplace accidents, remain the single largest category at 38% of claims.
However, the rapid rise in mental health-related claims is highlighted as a key trend in the data, with MoneyHub describing a workforce "under increasing pressure."
"Income protection is arguably the most underrated insurance product in New Zealand," said Christopher Walsh, founder of MoneyHub, in a statement.
"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."
The report notes that the average duration of an income protection claim is four to six months, with cancer and serious mental health claims often extending beyond two years. The average monthly benefit paid is $5,400, funded by average premiums of $115 per month.
Walsh said the figures show the scale of financial support available when illness or injury prevents people from working.
"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."
Meanwhile, the analysis also found that self-employed New Zealanders make up about 60% of policyholders, reflecting their lack of employer-provided sick leave or a substantial government safety net.
The average age at which people take out income protection is 41, typically when mortgages and family responsibilities heighten awareness of financial risk.
