Two laws about insurance cover in super came into effect during 2019, designed to ensure that super account balances are not unduly eroded by insurance premiums, particularly for accounts that have a low balance or have been inactive for a certain period. Read more about these changes below.

Important things to think about before deciding to keep, cancel or change your cover

Just like your home or car, your life and your ability to earn an income can be some of your most important assets. Having insurance cover may provide some financial protection if you are unable to work due to disability or if you die.

There may be some advantages of having insurance through your super, e.g. group premium rates may be more cost-effective than individual insurance rates, and paying for premiums through your super rather than your after-tax money may be tax-effective in some cases. However, it’s important to be aware that insurance premiums that are deducted from your account balance will reduce the amount of super that is available when you retire.

Your insurance needs can change over time so the cover you had in the past may or may not still be suitable for you today. For example, your needs for financial protection as a young single may be different to your needs if you have dependants or a mortgage. And if you’re downsizing or an empty-nester, your needs may be different again.

It’s important that you regularly consider and understand your current needs to make sure any insurance cover remains appropriate. This should include any cover for death and disability that you have through our fund, as well as any cover you have with another super fund or directly with an insurer.

It’s also important to understand the features of your cover, such as premium rates, when a benefit may or may not be paid, and exclusions that may apply. These features will generally be different between super funds or insurers, so you’ll need to consider what’s right for you.

You should also keep in mind that premium rates will generally increase as you get older.

 

  • Cancellation of cover for low-balance accounts on 1 April 2020
    • From 1 April 2020, these rules prevent super funds from providing insurance cover to you if your super account is a low-balance account, unless you specifically elect to keep your cover. For these rules, an account will be considered to be a low-balance account if the balance is less than $6,000 and hasn’t been equal to or greater than $6,000 at any time since 1 November 2019.

      The following Q&A's provide some additional information about these rules.

      Important: Please keep in mind that these Q&As are based on our understanding of current regulatory requirements and laws as at 25 November 2019. This information is not advice and provides information only. It does not take into account your individual objectives, financial situation or needs. You should read the Product Disclosure Statement and Reference Guides, or call us for a copy, and assess whether the information is appropriate for you. You should consider seeking professional advice tailored to your personal circumstances from an authorised financial adviser before making any decisions that may affect your financial future.

      Who’s affected by the insurance changes?

      You will be affected by these insurance changes if:

      • You have any insurance cover through your Accumulate Plus account – this could be cover for death, total and permanent disablement (TPD) and/or salary continuance (SCI), and
      • Your Accumulate Plus account balance is less than $6,000 and hasn’t been equal to or greater than $6,000 at any time since 1 November 2019.

      If both of these apply to you, we will have had to cancel your insurance cover automatically on 1 April 2020*. 

      If you don’t want your cover to be cancelled automatically, you will need to confirm to us that you want to keep your cover.

      * Your insurance cover may be cancelled earlier than 1 April 2020 if your account also meets the inactive super account rules and you haven’t provide an inactivity election.

      What do I do if I want to keep my cover?

      If you want to keep the insurance cover you have in Accumulate Plus, even if your account balance is less than $6,000, you must notify us of your election. You can do this by completing our Election to keep insurance cover in a low-balance account form.

      You may make an election at any time before 1 April 2020*. Once we receive your election, we’ll confirm this to you in writing.

      * Your insurance cover may be cancelled earlier than 1 April 2020 if your account also meets the inactive super account rules and you haven’t provide an inactivity election.

      What does making an ‘election’ mean?

      An election will be your instruction to us that you don’t want your insurance cover to be cancelled automatically if your account balance is below $6,000 on 1 April 2020 and hasn’t been equal to of greater than $6,000 at any time since 1 November 2019.

      Once you provide an election, your cover will remain in place and we will continue to deduct insurance premiums from your account balance each month.

      Of course, you are still free to cancel or reduce your cover at any time if needed. You can also increase your cover, transfer cover from another fund or policy, or apply for new cover, subject to the normal rules for cover in Accumulate Plus. Read our Reference Guide: Insurance cover for more information

      You should keep in mind that there may still be circumstances under the normal terms of insurance cover in Accumulate Plus or other super laws where your cover may change or end. Read our Reference Guide: Insurance cover for more information.

      If I make an election, can I still change my cover in the future?

      Yes. You are still free to cancel or reduce your cover at any time if needed. You can call us on 1800 023 928 to make these changes.

      You can also increase your cover, transfer cover from another fund or policy, or apply for new cover, subject to the normal rules for cover in Accumulate Plus. Read our Reference Guide: Insurance cover for more information

      You should keep in mind that there may still be circumstances under the normal terms of insurance cover in Accumulate Plus or other super laws where your cover may change or end. Read our Reference Guide: Insurance cover for more information.

      Can I top-up my account balance instead of making an election?

      Yes. If we receive a contribution to your account, either from you or from an employer, or if you transfer super into your account from another fund so that your account balance has been equal to or greater than $6,000 between 1 November 2019 and 1 April 2020, your account will no longer be considered a low-balance account for the purposes of these rules.

      Check out our options for how you or your employer can contribute to your account or how to transfer super into your account.

      Will any changes to my cover and/or premiums happen after I make an election?

      In some cases, yes. Although your cover won’t be automatically cancelled if it meets the low-balance rules, there are some circumstances where other changes to your cover and/or premiums may occur automatically.

      Depending on your category of membership, your amount of cover may change automatically. For example, if you are a permanent Group employee with cover linked to a multiple of your salary. In this case, when your salary increases or decreases, your amount of cover and monthly premiums will change accordingly.

      Insurance premiums are also based on your age, so premium rates generally increase each year on the first premium due date after your birthday.

      There may also be circumstances under the normal terms of insurance cover in Accumulate Plus or under other super laws where your cover may change or end. For example:

      • when you turn 70 (for death or TPD cover) or 65 for salary continuance
      • if there is not enough money in your account to cover your premiums when due
      • if your account is considered 'inactive' because it hasn't received any contributions or rollovers for 16 consecutive months.

      Read our Reference Guide: Insurance cover for more information on these circumstances.

      Can I make an election only for one type or part of my cover?

      An election to keep your cover for a low-balance account will apply to all types of cover that you currently hold in your account.

      If you want to change part of your cover, you can do so through our normal processes:

      • To cancel or reduce your cover, you can call us on 1800 023 928.

      If my cover is cancelled automatically, can I turn it back it on?

      No. If your cover is cancelled and you later decide you’d like to have cover through your account, you will need to apply through the insurer’s standard application and assessment process. This may require you to provided medical evidence and history to the insurer. The insurer may accept or decline any application.

      What happens if my account is a low-balance account and I don’t give an election to keep my cover?

      If we don't receive an election from you to keep your cover and your account remains a low-balance account, we must automatically cancel all cover in your account on 1 April 2020*. We’ll confirm to you in writing if your cover is cancelled.

      No further premiums will be deducted from your account after the cancellation date and you will not be entitled to claim an insurance benefit in relation to any sickness or injury that occurs after that date.

      * Your insurance cover may be cancelled earlier than 1 April 2020 if your account also meets the inactive super account rules and you haven’t provided an inactivity election.

      I recently received a letter about cancellation of cover due to inactivity – is this the same thing?

      We may have written to you (or may in the future) because your insurance cover was at risk of being cancelled under a different law related to inactive accounts because it hasn’t received any contributions or rollovers for 16 consecutive months. Each of these laws has different rules, so the potential cancellation dates for cover will be different.

      It’s important to be aware that because you may be affected by both the low-balance and inactivity rules, your cover may be cancelled on the earlier of 1 April 2020 or the date notified to you in the letter about inactivity rules if you haven’t made an election. It’s important that you carefully consider the information and dates in both letters and if you wish to keep your cover, provide an election before the earlier cancellation date.

  • Cancellation of cover for inactive accounts from 1 July 2019
    • From 1 July 2019, these rules prevent super funds from providing insurance cover to you if your super account is inactive, unless you specifically elect to keep your cover. Under these rules, an account will be considered ‘inactive’ if it has received no contributions or rollovers for 16 consecutive months.

      The following Q&A's provide some additional information about these rules.

      Important: Please keep in mind that these Q&A's are based on our understanding of current regulatory requirements and laws as at 4 April 2019. This information is not advice and provides information only. It does not take into account your individual objectives, financial situation or needs. You should read the Product Disclosure Statement and Reference Guides, or call us for a copy, and assess whether the information is appropriate for you. You should consider seeking professional advice tailored to your personal circumstances from an authorised financial adviser before making any decisions that may affect your financial future.

      Who’s affected by the insurance changes?

      You will be affected by these insurance changes if:

      • You have any insurance cover through your Accumulate Plus account – this could be cover for death, total and permanent disablement (TPD) and/or salary continuance (SCI), and
      • Your Accumulate Plus account has not received any contributions or rollovers for 16 consecutive months.

      If both of these already applied to you before 1 July 2019, we may have had to cancel your insurance cover automatically from that date. If your account has been inactive for less than 16 months, we will cancel your insurance cover at the date you reach 16 consecutive months of inactivity*.

      If you don’t want your cover to be cancelled automatically, you will need to confirm to us that you want to keep your cover.

      * Your insurance cover may be cancelled on 1 April 2020 (which may be earlier than the date advised to you in an inactivity notice) if your account also meets the low-balance account rules and you haven’t provided a low-balance election.

      What do I do if I want to keep my cover?

      If you want to keep the insurance cover you have in Accumulate Plus, even if your account does not receive any contributions or rollovers for 16 consecutive months, you must notify us of your election. You can do this by:

      You may make an election at any time. However, if we notify you that your insurance cover is at risk of cancellation, please ensure you take note of the date your cover may be cancelled*, as well as the cut-off date/time in which to provide your election.

      Once we receive your election, we’ll confirm this to you in writing.

      * Your insurance cover may be cancelled on 1 April 2020 (which may be earlier than the date advised to you in an inactivity notice) if your account also meets the low-balance account rules and you haven’t provided a low-balance election.

      What does making an ‘election’ mean?

      An election will be your instruction to us that you don’t want your insurance cover to be cancelled automatically if your account becomes inactive for 16 months or more, either now or at any time in the future.

      Once you provide an election, your cover will remain in place and we will continue to deduct insurance premiums from your account balance each month.

      Of course, you are still free to cancel or reduce your cover at any time if needed. You can also increase your cover, transfer cover from another fund or policy, or apply for new cover, subject to the normal rules for cover in Accumulate Plus. Read our Reference Guide: Insurance cover for more information

      You should keep in mind that there may still be circumstances under the normal terms of insurance cover in Accumulate Plus or other super laws where your cover may change or end. Read our Reference Guide: Insurance cover for more information.

      If I make an election, can I still change my cover in the future?

      Yes. You are still free to cancel or reduce your cover at any time if needed. You can call us on 1800 023 928 to make these changes.

      You can also increase your cover, transfer cover from another fund or policy, or apply for new cover, subject to the normal rules for cover in Accumulate Plus. Read our Reference Guide: Insurance cover for more information

      You should keep in mind that there may still be circumstances under the normal terms of insurance cover in Accumulate Plus or other super laws where your cover may change or end. Read our Reference Guide: Insurance cover for more information.

      Can I make a contribution to my account instead of making an election?

      If we receive a contribution to your account, either from you or from an employer, or you transfer super into your account from another fund, your account will no longer be considered inactive for the purposes of these rules.

      However, you should keep in mind that the 16-month period will reset from the date the last contribution to your account is received. This means your insurance cover could be at risk again in the future if your account becomes inactive.

      You can provide an election to keep your cover at any time, regardless of whether your account is active or inactive.

      Check out our options for how you or your employer can contribute to your account or how to transfer super into your account.

      Will any changes to my cover and/or premiums happen after I make an election?

      In some cases, yes. Although your cover won’t be automatically cancelled if it meets the inactivity rules, there are some circumstances where other changes to your cover and/or premiums may occur automatically.

      Depending on your category of membership, your amount of cover may change automatically. For example, if you are a permanent Group employee with cover linked to a multiple of your salary. In this case, when your salary increases or decreases, your amount of cover and monthly premiums will change accordingly.

      Insurance premiums are also based on your age, so premium rates generally increase each year on the first premium due date after your birthday.

      There may also be circumstances under the normal terms of insurance cover in Accumulate Plus where your cover may change or end. For example, when you turn 70 (for death or TPD cover) or 65 for salary continuance, or if there is not enough money in your account to cover your premiums when due.

      Read our Reference Guide: Insurance cover for more information on these circumstances.

      Can I make an election only for one type or part of my cover?

      An election to keep your cover for an inactive account will apply to all types of cover that you currently hold in your account.

      If you want to change part of your cover, you can do so through our normal processes:

      • To cancel or reduce your cover, you can call us on 1800 023 928.

      If my cover is cancelled automatically, can I turn it back it on?

      If your insurance cover was cancelled automatically under the inactivity rules, you have a limited window to ask us to reinstate your cover. If we receive a completed Request to reinstate cover form within 90 days from the date your cover was cancelled, we'll reinstate the same level of cover you had immediately before it was cancelled.

      If your cover is reinstated, it will be as if your cover was never cancelled. Monthly premiums will continue to be deducted from your account. Your first premium deduction after reinstatement will include any backdated premium that applies since the date your cover was cancelled, so you’ll need to make sure there is enough money in your account to cover this amount.

      Any request for cover that we receive after the reinstatement period has elapsed is subject to the insurer’s standard application and assessment process. This may require you to provide additional health and medical evidence and the insurer may accept or decline the application on that basis.

      What happens if my account is inactive and I don’t give an election to keep my cover?

      If we don't receive an election from you to keep your cover and your account remains inactive, we must automatically cancel all cover in your account on the date that your account reaches 16 consecutive months of inactivity*. We’ll confirm to you in writing if your cover is cancelled.

      No further premiums will be deducted from your account after the cancellation date and you will not be entitled to claim an insurance benefit in relation to any sickness or injury that occurs after that date.

      * Your insurance cover may be cancelled on 1 April 2020 (which may be earlier than the date advised to you in an inactivity notice) if your account also meets the low-balance account rules and you haven’t provided a low-balance election.

      I recently received a letter about cancellation of cover due to a low account balance – is this the same thing?

      We may have written to you (or may in the future) because your insurance cover was at risk of being cancelled under a different law related to low-balance accounts because your account balance is less than $6,000. Each of these laws has different rules, so the potential cancellation dates for cover will be different.

      It’s important to be aware that because you may be affected by both the low-balance and inactivity rules, your cover may be cancelled on the earlier of 1 April 2020 or the date notified to you in the letter about inactivity rules if you haven’t made an election. It’s important that you carefully consider the information and dates in both letters and if you wish to keep your cover, provide an election before the earlier cancellation date.