Changes to insurance
New rules may prompt you to consider whether you need the insurance on your super account.
Recent Government rules aim to protect low balance and inactive super accounts from being inappropriately eroded by fees and insurance premiums. For some members this will mean that their insurance cover has been, or will be, cancelled.
New laws known as ‘Protecting Your Super’ and ‘Putting Members’ Interests First’ mean:
- From 1 July 2019, we are required to cancel insurance cover on inactive accounts. An account is inactive if it has not received a contribution or rollover for 16 months.
- On 1 April 2020, we cancelled insurance cover on active accounts with a balance under $6,000.
- From 1 April 2020, members who are under 25 or have less than $6,000 in their account when they join will no longer receive automatic insurance.
You can elect to keep your cover if you are affected by the new rules (see ‘How do I keep my cover?’ below).
You can find out how much insurance cover you have by logging into your account and selecting ‘Insurance>Insurance cover’ in the top menu.
If you want to find out what your insurance costs are, check your latest Benefit Statement, or give us a call.
Keeping you informed
We will contact you if you are affected by these new laws so you can consider whether you want to keep your insurance with us.
We will also let you know you when your account has been inactive for 9, 12 and 15 months, warning you that your insurance will be cancelled after 16 months of inactivity.
Should I keep my insurance?
– You can decide whether you would like to keep your insurance cover or are happy for it to be cancelled.
– You can also tell us which types of cover you want to retain.
Why have cover
– Insurance can help you and your loved ones pay the bills and keep things going if something happens to you.
– Insurance through your super is usually cheaper as we use bulk purchasing power to negotiate competitive prices on your behalf.
– Premiums are paid out of your super balance, not out of your pocket.
– If you later decide you want to reapply your health, lifestyle and occupation will be assessed, after which the insurer will decide whether to accept your application.
– Premiums for your insurance cover can erode your retirement savings.
– You may have other cover with another super fund, or outside the super system.
– You don’t need any insurance because, for instance, you don’t have any dependants.
– Keeping your cover means paying multiple sets of fees to keep your account open.
You can cancel your insurance cover at any time by completing and submitting a Request to Change Insurance Form.
Find out more
Further information is also available on the Government’s MoneySmart website. Check the ‘Insurance through super’ page, in the ‘Super & retirement’ section.
A financial adviser can also provide you with recommendations about your insurance. Find out more about our advice services.
Need some help?
If you are unsure about whether you should keep your insurance cover, one of our advisers can provide you with advice about how much cover you should have, over the phone, at no extra cost.
Call us on 1800 025 241 to make an appointment.