New legislation to impact young Australian workers
Parliament last week passed legislation that’s set to impact the insurance of thousands of young Australian workers.
The legislation prevents anyone under 25 years of age from receiving default insurance in super when they open a new super product on or after 1 April 2020.
In addition, members whose account balances have not been above $6,000 since 1 November 2019 will lose any default insurance attached to their account on 1 April 2020.
Any Intrust Super member who has their insurance cover cancelled will lose access to Intrust Super’s ‘Best Value Insurance in Super’* Life and TPD insurance and PayGuard Income Protection insurance. Life and TPD can cover eligible members for up to $300,000^ (though more cover can be applied for), while Income Protection can cover up to 90% of an eligible members’ income.
In particular, members who are employed as casuals could be significantly impacted by the loss of their insurance. Without access to sick leave, an unexpected, long-term absence from work could cause these workers some significant financial difficulty.
Super funds were historically required by law to offer default insurance in order to qualify as a default fund. In the past, automatic insurance through super was an easy way for Australians to protect themselves financially without affecting their family budget.
The legislation allows funds to exempt members in dangerous occupations, subject to certain conditions. And once a member reaches the age of 25 and has their account balance reach more than $6,000, insurance will once again be reinstated.
Intrust Super will be contacting any members likely to be affected by this new legislation. Members who wish to keep their insurance can fill out our insurance form to opt-in to insurance cover.
If you’d like to know more about this legislation, you can get in touch with your Relationship Manager, or use our Super Concierge service to have an Account Manager contact you. You can also call us on 132 467.
*Awarded by Money magazine from 2013-2018
^Cover for an amount of $300,000 applies to Intrust Super Core Super|MySuper members aged under 40.