UPDATE: Insurance and Protecting Your Super

Important update. Are you at risk of insurance cancellation?

Recently, the Federal Government introduced the Protecting Your Super package. The new laws are designed to ensure that super members who hold insurance inside superannuation are not;

  • paying for insurance cover that they do not know about, or

  • subject to insurance premiums and other fees inappropriately diminishing retirement savings.

From 1 July 2019 super providers must cancel insurance in any super account that is considered inactive. It is strongly recommended that you act now to ensure your valuable insurance remains in place.

What is considered an ‘inactive’ super account?

An inactive super account is one that is not receiving contributions (employer or personal) or rollovers from other super accounts for payment of insurance premiums, for a period of 16 continuous months or more.

Does This Affect You?

You may have already received, or soon will receive, correspondence from your super provider advising that you are at risk of your insurance being cancelled due to the inactivity of your super account.

What You Need To Do

  • To retain your insurance, you will need to notify your super provider that you wish to retain your insurance. Your insurance will not be at risk again, even if your super account becomes inactive again in future.

  • If you do nothing, your insurance will be cancelled.

The Risks Of Taking No Action

By doing nothing, you will lose insurance cover held within your super account, and therefore lose the ability to make a claim in future (in the event of death or disability). Should you chose to consider insurance cover again in future, you may not easily be able to obtain the cover that has just been cancelled, due to pre-existing medical conditions or increased premium costs, for example.

It is strongly recommended that you act now to ensure your valuable insurance remains in place. You may, in future, choose to cancel or alter your insurance cover held within super, after consultation and consideration. This will be your choice.

If you do nothing, the super provider makes this decision for you.

If your insurance is at risk, or you have any questions please contact your provider before June 30, 2019.

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