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Important changes to insurance in super: how will they impact your workers?

March 10th, 2020

The laws around insurance inside super change on 1 April, which may affect your workers’ cover for Death and Total and Permanent Disablement (TPD).

From 1 April, the Federal Government’s Putting Members’ Interests First (PMIF) legislation means if a person’s super account balance is less than $6,000 and/or they’re aged under 25, they won’t be eligible for automatic insurance cover. This change applies to all superannuation funds.

This change may see many workers in high-risk occupations facing the prospect of not having insurance cover if they’re no longer able to work due to illness or injury, or in the event of their death. These workers can protect themselves by opting in to have insurance inside their super account.

First Super is the industry superannuation fund for timber, pulp and paper, and furniture and joinery workers. We understand quality insurance cover is important for your workers because they work in high-risk environments and may have young families to support.

Why is this happening?

The PMIF reforms aim to ensure workers are not paying for insurance they may not need or know they have, and to prevent their super balances being inappropriately eroded by insurance premiums.

What can I do to help protect my workers?

It’s important to talk to your staff and encourage them to check their insurance cover with their superannuation fund. Perhaps you can consider including this issue as part of your staff induction program.

If you want more details or help

If you would like any support with this matter or any other super related query, you can speak to your local Business Development Manager or Member and Employer Services Coordinator. Or you can contact our Employer Services Team on 1300 943 171 for general questions.

If one of your employees approaches you with a query about the PMIF reforms, or with a letter or email that they have received from us about the risk of losing their insurance, we are here to help.

They can:

  • contact our Member Services Team;
  • speak to their local Member and Employer Services Coordinator; or
  • obtain personal advice from one of our authorised Financial Planners.

For any of the above, please direct them to call us on 1300 360 988 or email mail@firstsuper.com.au. More information on the reforms and how they affect our members is available from our website at .

 

Disclaimer: First Super Pty Limited (ABN 42 053 498 472, AFSL 223988) as trustee of First Super (ABN 56 286 625 181). This information contains general advice which has been prepared without taking into account your objectives, financial situation or needs. You should consider whether the advice is appropriate to your personal circumstances and consult the Product Disclosure Statement www.firstsuper.com.au/pds before making any investment decision.