Cancellation of insurance
Protecting Your Super
To protect the super balances of all Australians from erosion by unnecessary fees and costs, the Federal Government has introduced the “Protecting Your Super” reforms (formally titled Treasury Laws Amendment (Protecting Your Superannuation Package) Bill 2018), which passed on 18 February 2019.
This new legislation will apply from 1 July 2019, and requires the Trustee of super funds to cancel a member’s insurance if their account has been inactive for 16 months or more. Warning letters will be sent to all members whose accounts are at risk of becoming inactive.
An inactive super account is one where no employer contributions (e.g. Superannuation Guarantee, salary sacrifice), personal contributions (e.g. voluntary, spouse), or transfers/rollovers from other super accounts have been received within 16 months or more.
Why are you impacted?
The Protecting Your Super Bill impacts all existing and new super fund members.
You have received a letter because your account will either be classed as inactive on 1 July 2019, or it’s at risk of becoming inactive at a later date if you don’t take action.
Please refer to your letter from us to review your options to reactivate your super account.
Reinstatement of your cover
If your insurance cover ceases, it can be reinstated if you contact us within 60 days of it being turned off. To reinstate your cover, your account must have enough funds to pay the premium owed for the period your cover was turned off.
Are there any other changes?
Other changes to super from the Protecting Your Super bill include:
- capping fees at 3% per financial year for accounts with a balance $6,000 or less
- banning exit fees
- transferring inactive accounts with a balance below $6,000 to the ATO
- granting the ATO powers to reunite members with their lost or transferred super within 28 days.
The legislation changed from its original proposal in the 2018 Federal Budget, so the Government intends to introduce a separate bill to deal with other insurance reforms in the future. Please refer to the Federal Register of Legislation for a copy of the Treasury Laws Amendment (Protecting Your Superannuation Package) Bill 2018.
Making contributions over age 65
If you’re under the age of 75, you are eligible to make contributions into your superannuation account. However, there are other eligibility criteria such as a Total Super Balance (TSB) of less than $1.7 million and the annual contributions cap that still apply.
We can help you
It’s important you have the right level of insurance cover. Our Insurance needs calculator makes it easy to work out your requirements.
One of our financial planners can help you with a comprehensive evaluation of your current financial state and give advice for your future.*
If you have any questions, please:
- call us on 1300 655 002
- email email@example.com
- request a call from a Superannuation Specialist using the form below.
* If you haven’t met with one of our financial planners before, your initial discussion is completely free. Any additional costs will depend on the complexity of your financial situation and financial plan.