Get ready, there are changes coming to superannuation on 1 July that’s likely to affect three million Aussies – are you one of them?
The chances are you will be, if either your employer or you haven’t contributed to your super account for the last 16 months or more. If that’s you, then the changes mean that any insurance cover currently in place within your inactive super accounts will be switched off. Put simply, you lose your insurance coverage.
Your available options:
If your super account is active and is regularly receiving contributions, either by you or your employer, then the good news is that your insurance won’t be affected by these changes. So, relax, there’s nothing to worry about. It’s business as usual.
If your super account has been inactive for 16 months or more, then you have two options:
You can choose to keep your insurance but you will need to contact your super fund before 1 July and let them know. Your fund will probably ask you to formalise your request by putting it in writing, either via completing a form on the fund’s website, responding to a text message or sending an email; or
Simply let your insurance cover lapse on your inactive super account. Once you’ve made this decision, you don’t have to do anything.
Do you need insurance?
Choosing whether to have insurance or not through your super is very much a personal decision. There are a number of factors you need to consider like:
how much debt do I have;
how do I service that debt due to illness, incapacity or death;
how much does my family need to maintain their lifestyle; and
what conditions are covered, or not, by the policies I am considering.