Don’t forget - On 1 July 2019 your insurance cover may be changing!
In February this year, the Government passed legislation aimed at protecting low superannuation balances. These reforms commence from 1 July 2019.
Under the new legislation, if your superannuation account is considered inactive for 16 months your insurance will be terminated. A fund is considered inactive if it has received no contribution or a rollover for a continuous period of 16 months. These rules apply to funds regulated by APRA (Australian Prudential Regulation Authority), so does not impact inactive accounts in Self Managed Superannuation Funds (SMSFs).
APRA-regulated funds had until 1 May to identify and inform those inactive members that their insurance will soon be switched off unless they elect to retain it.
So what can you do?
It is important that if you wish to maintain your insurance cover that you take necessary steps before 1 July 2019. This includes either:
- Providing a direction to your fund that you wish to ‘opt-in’ for your insurance cover to be maintained.
- Making a contribution or rollover to your ‘inactive’ fund so that the period for which your fund starts to be inactive is reset. However, it stressed that you also ‘opt-in’.
If you have any questions, or require assistance please contact your usual Mazars advisor or alternatively speak to our Superannuation Specialists on:
+61 7 3218 3900
+61 2 9922 1166
+61 3 9252 0800
Please note that this publication is intended to provide a general summary and should not be relied upon as a substitute for personal advice.