The Government’s Protecting Your Super (PYS) reforms – designed to protect your super balance – began operating on 1 July 2019.
Since 1 July 2019, we are required to remove insurance from ‘inactive’ super accounts – these are accounts that do not receive a contribution or rollin for 16 months.
This has led to most super funds having fewer insured members than before, this being the case with TWUSUPER. This has resulted in insurers – including our insurer, TAL Life Limited – reviewing insurance fees.
From 1 November 2019 insurance fees are increasing for all insured members who have:
- Death and Total and Permanent Disablement (TPD) basic cover
- Death and TPD fixed basic cover and voluntary cover (including individual transfer terms cover and lifetime event cover), and
- Income Protection (IP) cover.
If you do not have insurance cover with the Fund, these changes will still affect you if you become eligible for, or apply for insurance in the future.
The PYS reforms have led to several other changes being implemented since 1 July 2019:
Inactive low balance accounts
An ‘inactive low balance account’ is one where the account:
- is under $6,000, and
- has not received a contribution or roll-in for 16 months, the member does not satisfy a condition of release, and no changes have been made to investment options, insurance cover or binding beneficiary nominations for 16 months.
If you have an inactive low balance account, we are required to send the account balance to the ATO. This means you will no longer be a TWUSUPER member – any insurance cover you have with the Fund will have already ended under the PYS reforms. The ATO will try to consolidate your super with any active super accounts you may have. If the ATO cannot consolidate your super money, it will remain with the ATO until you claim it.
Removal of exit fees and introduction of fee cap
There are no exit fees for leaving a super fund or for any partial withdrawals of super. Administration fees, investment fees and indirect costs will be capped at 3% each financial year for balances under $6,000. Refunds of any amount charged in excess of the cap will be made within three months of the end of the financial year or your exit from the Fund.
For more information
Full details of the above changes are contained in our Significant Event Notice dated 20 September 2019. Our Member Service team can also help with any queries – us on 1800 222 071 from 8am to 8pm (AEST/AEDT) weekdays.