Statutory injury cover update. Australia’s Workers Compensation & New Zealand’s ACC
Premium rates may be stable in some jurisdictions and rising in others, but the real story lies in the reforms, claim trends and levy changes set to affect employers in the year ahead. Our latest update, including the latest news from New Zealand’s ACC (Accident Compensation Corporation), gives you a clear view of the 2025 – 26 landscape.
AUSTRALIA
The 2025 - 26 workers compensation (W/C) landscape continues to show signs of stability in many jurisdictions, targeted increases in others, and continuing reform momentum, especially around psychological injury.
Across Australia, mental health claims remain a major cost driver, with Safe Work Australia noting faster growth rates, longer durations, and more complex return-to-work (RTW) requirements than physical injuries.
Government scheme states
New South Wales (NSW) has implemented the final 8% average premium increase under its three year capped program to stabilise the Nominal Insurer. Alongside this, a reform bill focused on psychological injury that is raising impairment thresholds, clarifying definitions (including “reasonable management action”) and tightening eligibility remains before Parliament, with potential changes due to commence progressively from FY25–26.
Victoria (VIC) has held its average premium rate at 1.8% for the third consecutive year. However, the major change remains the mental injury reforms introduced in March 2024, which require a predominant cause test and exclude claims for stress/burnout unless linked to traumatic events.
Queensland (QLD) retains one of the lowest average net premiums nationally, at $1.343 per $100 of wages, continuing a decade long record of stable rates supported by a strong return-to-work performance.
South Australia (SA) has maintained its average premium at 1.85% for the third consecutive year, reflecting steady scheme finances and relatively stable claims experience.
Privately underwritten ‘risk’ states
Western Australia (WA) has increased its average recommended premium rate by 5.3% to 1.823%, driven by higher average claim costs, greater claim frequency and projected wage growth. WA remains the largest privately underwritten jurisdiction in Australia, with industry rates published annually by the regulator.
Tasmania (TAS), Australian Capital Territory (ACT), and Northern Territory (NT) are also privately underwritten. In these jurisdictions, the regulator releases suggested or reasonable industry premium rates, but final employer rates are set competitively by insurers. Without regulated caps, premiums in these markets can vary widely based on claims history, risk profile and negotiated terms.
NEW ZEALAND
Accident Compensation Corporation (ACC)
From 1 April 2025, the ACC Work Account Levy rose from $0.66 to $0.69 per $100 earnings (with further increases planned to $0.72 in 2027/28), while the maximum earnings threshold was lifted to $152,790. Experience rating thresholds for larger employers also increased from $500 to $750, eliminating cross subsidies and aligning rates more closely with employer claims performance.
The ACC also began expanding its coverage for occupational diseases by adding 12 new conditions and increasing weekly compensation, lump sum and survivor benefits from 1 July 2025 (2.53–2.89% adjustments, tied to the CPI and Labour Cost Index).
What this means for employers
In the Australian government scheme states, budgeting is straightforward at the average level; however,psychological injury prevention and early intervention are now pivotal in NSW and VIC, with a similar focus emerging nationally.
In risk states, competitive tendering, insurer engagement, and demonstrable risk management improvements can have a direct and material impact on premiums.
In New Zealand, employers can expect broader coverage but will need to prepare for higher levies.