Significant Event Notice – 1 March 2016
Changes to insurance
Australian Ethical Super is proud to offer members one of the most competitive, best-value insurance arrangements on offer. Our insurance premiums have not increased for the past 3 years, and we were recently nominated as a finalist in the Money Management Adviser Choice Risk Awards.
The changes outlined in this notice are reflective of our continued commitment to provide good value, easy-to-understand insurance for our members.
Terminal Illness Benefit
In July 2015 the Government amended superannuation laws to allow earlier access to super fund monies for people suffering from terminal illnesses. The change means that the life expectancy requirement for early access has increased from 12 months to 24 months.
The driving force behind this proposal can be attributed to lobbying from breast cancer support groups, such as Breast Cancer Network Australia, to enable women suffering from secondary breast cancer, with a life expectancy of two years, to access their super to assist with medical costs.
While trustees will be required to give effect to this more generous condition of release, there is no legislated requirement to bring insurance arrangements in line with these changes.
We believe that earlier access to super fund monies could be beneficial for people suffering from a terminal illness and we have worked closely with our insurer to make this positive change to our insurance policy.
Terminally ill people can seek an early release of death benefits where medical certification indicates that they have less than 24 months to live. Previously this period was 12 months.
Terminal Illness means:
- two Medical Practitioners, one of whom specialises in your illness, certifies in writing that despite reasonable medical treatment the illness will lead to your death within 24 months of the date of the certification; and
- the insurer is satisfied, on medical or other evidence, that despite reasonable medical treatment the Illness will lead to your death within 24 months of the date of the certification referred to in paragraph (a).
On 1 March 2016 there will be an increase to the amount you pay for your insurance. The increased cost reflects a rise in insurance claims across the industry and also the inclusion of a longer Terminal Illness benefit period. The amount of cover you currently hold will not change.
Default & Unitised Insurance
The premium for 1 unit of Death and Total & Permanent Disablement (TPD) insurance will be $1.08 per week (previously $1.00 per week).
As an example, this means that members with default cover of 3 units of Death and TPD cover, the cost of your insurance will increase from $3.00 per week to $3.24 per week.
The amount of cover provided for each unit and each age will not be changing. Please refer to the appendix for details of the default level of cover provided.
You should request a copy of the 2016 Insurance Guide for further information.
Income Protection Cover
On 1 March 2016 there will be an increase to the amount paid for Income Protection cover.
If you hold or are considering applying for Income Protection cover you should refer to the Income Protection Cover premium rate tables available at australianethical.com.au/super/insurance/ for further information.
On 1 March 2016 there will be an increase to the amount paid for fixed insurance cover. If you are considering applying for fixed cover you should request a copy of the 2016 Insurance Guide for further information.
Occupation Category changes
As part of the insurance renewal effective 1 March 2016, the occupation categories will be renamed to make them easier to understand and more reflective of our membership.
If you have not advised us of your occupation category it will be recorded as the default category of Standard.
For members with unitised cover, the occupation category affects the level of cover you have but not the amount you pay. It is important that you advise us of your correct occupation category to make sure you have the correct level of cover. In the event of a claim the Insurer will re-assess your occupation category that applies at that time.
You can update your occupation category by completing an Insurance Variation form available at australianethical.com.au/super/forms/.
|Current Occupation Category||New Occupation Category|
|Heavy Blue (Unskilled)||Basic|
|Heavy Blue (Skilled)||Standard|
|Light Blue||Standard Plus|
|White Collar||White Collar|
What do you need to do?
This notice is for information purposes. In conjunction with this notice you should also read the updated information contained in the 2016 Insurance Guide. Available on request.
This information is general information only and does not take account of your individual investment objectives, financial situation or needs. Before acting on it, consider seeking independent financial advice.
If you wish to update your personal information this can be done through the secure member portal at australianethical.com.au/client-login/, by calling us on 1300 134 337 or emailing us at firstname.lastname@example.org
Head of Client Relations
Appendix: Amount of Default Cover (White Collar Occupation)
|Age Next Birthday||Default Automatic Insurance|
^ The amount of TPD cover you have decreases when you reach age 61.
|Notes||Occupation Class||Death||Death & TPD|