Important legislation introduced to the Superannuation Industry.

Recently, the Australian Government introduced the “Putting Members Interests First” legislation to the Superannuation industry. Designed to help young people and those with low account balances by removing insurance cover which can erode or even prevent super balances from growing.

These important changes could affect your super accounts from 1 April 2020 so we have compiled a brief summary to keep you informed on how it may affect you.

Quick Summary of Changes

• Super Funds will be forced to cancel insurance cover for members with balances of less than $6,000, unless you communicate to them in writing that you wish to keep your insurance.
• New members joining a super fund with default insurance won’t have their cover start until they are at least over the age of 25 and have a balance of $6,000 in their super account.

If any of your accounts are affected by the changes, your superannuation provider should have written to you recently to notify you that your account would be affected, including how the changes would impact you and what action you would need to take.

It is really important that you open and read any correspondence from your superannuation provider, as this is the only formal notification that takes place in relation to affected accounts.  Unfortunately, we do not automatically receive notification or correspondence in relation to this on your behalf so might not be aware that your account is affected.

Also, it is really important that if you are affected by the changes that you are taking the appropriate action in relation to your account, as quite often existing insurances have been kept intentionally, particularly if you are no longer able to get either new or a similar quality of cover due to age or health reasons.

What do you need to do?

We are here to help, so if you have received any correspondence or think you could be affected by the changes, please feel free to give us a call as we would be happy to do a quick review of your account and confirm any action that might be required…

If you receive a notification in relation to your account – Contact us to let us know, so that we can assist with taking the appropriate action in relation to your account.

If you are not sure if your superannuation fund has your current address – Contact us to let us know, so that we can update your contact details with your superannuation provider and confirm whether there are any outstanding notices on your account.

If you know that your existing insurances need to be retained (i.e. due to medical history) – Contact us to let us know, so that we can complete the opt-in to ensure that your insurances are not at risk of being cancelled in the future.

If you think you might be affected in some way by the changes, but are not sure – Contact us to let us know, so that we can complete a review of your account and let you know if there is any action required.