Over the past 12 months, two new pieces of legislation have significantly reshaped the group life insurance landscape in Australia.

On 1 July 2019, the Federal Government’s Protecting Your Super (PYS) package came into effect, followed by the implementation on 1 April this year of the accompanying Putting Members’ Interests First (PMIF) legislation.

The result has seen a significant number of superannuation members losing their insurance cover and an opt-in system that now places responsibility for cover squarely on the shoulders of fund members.

PROTECTING YOUR SUPER AND PUTTING MEMBERS’ INTERESTS FIRST: A FUNDAMENTAL SHIFT

PYS legislation aims to reduce the number of inactive, duplicate accounts in the super system and the depletion of low account balances by fees and insurance premiums.

Members with multiple accounts were found to comprise a third of all accounts (about 10 million), causing the erosion of balances in the order of A$2.6 billion per year in fees and insurance.

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