The ‘protecting you super’ legislation is designed to protect peoples’ super with changes relating to insurance in super, fees and lost member accounts. Make sure you’re well informed and find out what you need to do if you’re affected.
What are the changes?
Changes to insurance in super
The insurance-related legislation impacts anyone who has an inactive super account. It aims to prevent your retirement savings from being eroded by insurance premiums. This means that if you have insurance as part of your super and no contributions have been received into your account for 16 months, regardless of your fund balance, your insurance will be cancelled unless you take action.
If you are currently affected, you should have received a letter from us in April 2019 advising you of the date your insurance would be cancelled and the ways you can retain it.
After 1 July 2019, if you are affected, we will start to notify you after 9, 12 and 15 months of no contributions into your super fund.
You can retain your insurance by either:
- logging into your account, going to the insurance page and clicking on the opt-in button. This opt-in is enduring however, you can change or cancel your insurance at any time.
- having a contribution made into your account.
Deciding whether to retain your insurance can be difficult. You should consult with a financial adviser to understand the consequences and what the appropriate decision is for you. If you don’t have an adviser please contact us and we can put you in touch with one.
- From 1 July 2019, when you exit a super fund you will no longer be charged an exit fee.
- From 1 July 2019, if your super account balance is under $6,000 there will be a cap placed on fees, limiting them to no more than 3% per year.
- Super funds are required to transfer ‘inactive low balance’ accounts to the Australian Taxation Office (ATO) every six months. The ATO is now also responsible, where possible, for consolidating this money with the person’s other active super account or to their estate if they have passed away. An inactive low balance account is now broadly defined as an account of under $6,000 where no activity has occurred in the last 16 months. This includes where no contributions have been made to the account in the last 16 months and where there is no active insurance on the account. Other new definitions apply.
To check if you have any lost super log in to your account and click on the ‘Start your super search’ button under ‘Find and consolidate your super’.
If you have any questions, please contact your financial adviser. If you don’t have a financial adviser, please contact us and we will put you in touch with one.