You’ve probably got plenty to worry about with the Coronavirus crisis happening, but did you know there are important changes occurring to superannuation and Life Insurance from the 1st April 2020? Many superannuation fund members will lose their TPD and Death Insurance after the 1st April 2020 unless they tell their super fund that they wish to continue.
“Many vulnerable Australian employees and workers have been badly impacted by the Coronavirus crisis and should be protected if they find themselves out of a job especially if they can no longer work due to severe ill health or injury. These people may find out later that they don’t have the necessary life insurance cover for permanent injury or death resulting from the coronavirus crisis which would be extremely distressing. This is why we URGE EVERYONE to contact their superannuation provider before the 1st April and make sure their Life Insurance is still active. “ says our Principal Solicitor, Owais Shaheen.
What are the changes?
From the 1st April 2020, Life Insurance held by some Australians within their super accounts will be automatically cancelled if they do not call/email and ask to continue to have Life Insurance cover. This cover includes things like Death, Total And Permanent Disability and Income Protection.
Who will be impacted?
Normally all Australians who hold a super account have default life insurance cover. The changes from 1 April 2020 will effect those who:
- Are under 25 years; or
- Those with less than $6000 in their super fund; or
- An account that has been inactive for 16 months or more.
How do you protect your Life Insurance cover?
It’s easy to protect your Life Insurance cover.
YOU NEED TO GIVE YOUR SUPER FUND A CALL IMMEDIATELY.
Let them know that you do not wish to opt out of Life Insurance cover. This must be done before 1 April 2020. Some Superannuation Fund Providers have online services as well which gives you instructions as how to continue your Life Insurance cover after 1 April 2020. Depending on your situation, it may be simply a matter of sending them the request to continue your Life Insurance.
But this is such a bad time!! We are amidst a crisis.
We understand how stressful these times are and ideally an automatic cancellation of Life Insurance is not helpful for anyone right now as they may be left in a vulnerable situation. However, these changes had been arranged prior to the coronavirus crisis emerging.
The aim of these changes were initially to benefit members. The purpose was to ensure super accounts with low balances do not end up with zero balances by paying the insurance premium and fees. According to these changes, inactive accounts will roll over to the ATO and be combined with active super accounts to help people avoid multiple fees.
Our Principal Solicitor, Owais Shaheen urges the public to contact their superannuation provider and confirm that their Life Insurance to remain active after the 1st April 2020 changes.
If you’ve got enough on your plate right now with kids at home, worrying about the health crisis AND trying to find enough toilet paper at the store and you don’t want to be further confused about your superannuation, you can call the trusted legal experts at Shaheen Legal and they will walk you through the process.
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