Recently the federal government introduced new laws, known as the Protecting Your Super package, designed to ensure that members are not paying for insurance cover that they do not know about or premiums that inappropriately diminish their retirement savings.
About The Reforms
From 1 July 2019, these new laws require super providers to cancel insurance inside super, once the account has been inactive for a continuous period of 16 months, unless a customer tells us not to.
How This Affects You
If your super account has not recently received any amounts, ie it has had no recent contributions or rollovers, the insurance may be cancelled on or after 1 July 2019 unless they tell us not to, as set out below.
If you make a contribution or rollover to your super account before your account reaches 16 months of continuous inactivity, your insurance will not be cancelled unless your account becomes inactive again.
Some Things You Should Consider Before Deciding
- By doing nothing, you may lose your insurance cover or any ability to make a claim against this insurance cover.
- Where you have premiums paid in advance, you will be entitled to claim for the period you have already paid for, despite your insurance being cancelled due to your account reaching 16 months of continuous inactivity during that period.
- You will no longer pay an insurance premium from your super account if your insurance is cancelled.
- By no longer having life insurance (also known as death cover), your dependents or other beneficiaries will not receive the insurance benefit inside this account if you die or become disabled (as covered by your policy).
- It can be complicated for certain people to get insurance cover. For example, if you have a pre-existing medical condition or are aged 60 or over, by cancelling your existing policy you may not be able to reinstate this cover (to the same benefit level) or get insurance elsewhere at the same premium.
- When considering the insurance that’s right for your circumstances, you should check the most recent statement, product disclosure statement (PDS). Product features, like waiting or benefit periods can vary between policies.
What You Need To Do Next
Contact Personal Risk Professionals for a review of your personal insurance needs.
*This information is of a general nature only and has been provided without taking account of your objectives, financial situation or needs. Because of this, you should consider whether the information is appropriate in light of your particular objectives, financial situation and needs.