New laws for Superannuation come into effect on 1 July 2019. These new laws will directly impact the amount of insurance you currently hold within your super. This is a timely reminder to check your super and make sure you have the right insurance for your circumstances.
If you have a super account with a low balance, or one that has been inactive for 16 months or more, you will most probably have already received a letter from your fund administrator notifying you that the insurance held within your account, if any, is likely to be cancelled. The letter will further ask you to take steps to notify them should you wish to retain the insurance.
These new laws will affect Death, Total & Permanent Disability (TPD), and Income Protection insurances held within low balance/inactive super accounts.
It is very important that you take steps to retain this insurance if you are relying on it to protect your family in the event of your death, and to protect your income and lifestyle in the event you cannot work, or you become permanently disabled. If you are relying on this insurance and you allow it to be cancelled, you will most likely have to undergo all the medical tests and procedures required to make a new application for insurance. This could result in you paying more for your insurance and losing cover for any new medical conditions that have arisen in the time since you first took out the insurance in your super fund.
There are many advantages to holding insurance within your superannuation funds, and this new legislation will make a real change to the cover you hold if you do not take action when notified, so make sure you open and read any letters, emails or SMS messages you receive from your super fund.
We can help you to make an assessment of your insurance needs and advise you on the best way to pay for your insurances – either inside your super or outside of super. So, please do not hesitate to contact John Kalachian at Fortis Accounting Partners on (02) 9267 0108 if you have any questions or concerns regarding your super and insurance needs.
