By Vicki Doyle, Chief Executive Officer of Rest
In late September, the government passed legislation called Putting Members’ Interests First (PMIF) to protect members with low super balances and those who are younger than 25 from having their retirement savings eroded.
These new rules mean that members will have their automatic insurance cancelled on 1 April 2020 if their account balance was less than $6,000 on 1 November 2019 and does not exceed that amount at any point up to 31 March 2020.
These members will have to tell us if they want to keep their insurance.
Similarly, new members who join from 1 April 2020 onwards will not be provided with automatic insurance until their balance reaches $6,000 and they turn 25 years old. Until members meet both of those conditions, they will have to opt in to receive insurance cover.
When members become eligible for insurance, their cover will commence once they receive an employer contribution.
The value of insurance
At Rest, we believe insurance is an important part of super that can support people and their families when things go wrong.
We regularly review our insurance offering to ensure it continues to provide our members with access to affordable and valuable cover. Our most recent review in 2018/19 also included a tender process – which resulted in the appointment of TAL Life as our new insurance provider.
TAL Life began providing cover to members from 1 December 2019. A new insurance offering designed for Rest members will commence on 1 April 2020 to coincide with the PMIF start date.
More information about the new insurance offering can be found here.
Elections to date
We’ve been contacting potentially affected members since late last year to explain the impacts of the PMIF legislation on their insurance cover. Around 12,800 members have indicated that they’d like to keep their insurance.
As we approach 1 April 2020, we will continue to communicate with affected members, who will be provided with a web link or a form to make a choice about their insurance, and sent reminders if they haven’t made a choice.
In order to learn more about the changes and to help educate your employees about their choices, we’ve provided a suite of resources including a poster, flyer and other content you can download from our Employer Toolkit.