Putting Members' Interests First - what you need to know

Your super is designed to help you save for your retirement. That's why it's important that it isn't eaten away by premiums for insurance cover that you may not need.

To address this issue, the Federal Government has introduced their Putting Members' Interests First (PMIF) reforms. These reforms are designed to encourage you to make an active choice about the insurance in your super or pension.

We've provided some information here about what the PMIF reforms are and how they may affect you.

What's happening under the PMIF reforms?

Starting on 1 April 2020, LUCRF Super won't be providing insurance to:

  1. members whose super or retirement pension balance is less than $6,000 and has never been $6,000 or more on or after 1 November 2019, and
  2. members under 25 who open a new super account on or after 1 April 2020,

unless the member has otherwise elected to have insurance.

Please note: The PMIF reforms apply to each super account a person holds. This means that if you have more than one account with us or another super fund, you might have multiple insurance policies that could be cancelled. You may want to review your insurance needs before making a decision about any insurance through your super account. Information about where you can get help reviewing your insurance needs is included below.

What does this mean for you?

Are you an existing member?

These new reforms mean that if your super or pension balance is below $6,000, any insurance cover you have with us will be cancelled effective 1 April 2020, unless:

  • you elect in writing that you want to keep it, or
  • your balance goes above $6,000 at any time before 1 April 2020.

If you currently don't have insurance on your account, these reforms will not affect you unless you decide you'd like to apply for cover in the future (see "I currently don't have insurance…" below).

What are my options?

Consider whether any insurance cover you have with us suits your personal circumstances, based on things such as:

  • your current age
  • whether you have a partner or dependants who rely on your income
  • your debts and living expenses
  • any insurance cover that you have with other super funds
  • any insurance cover that you have outside of super
  • the cost of maintaining your insurance and the impact this may have on your account balance.

We've outlined a number of options available to you regarding your insurance with LUCRF Super as follows.

Option 1: Elect to keep the insurance you have with us

To keep your insurance with us, complete and sign this insurance opt-in form. Return the form before 31 March 2020 to avoid the risk of having your insurance cancelled on 1 April 2020. We must receive your request by this date, so allow time for delivery if you're posting the form.

Option 2: Make changes to the insurance you have with us

You can apply to increase, reduce or convert your Death & Total and Permanent Disablement (TPD) or Death Only cover and/or apply for or increase your Income Protection (IP) cover (subject to terms and conditions) by calling us on 1300 130 780 or completing the relevant forms. Other changes you can make include matching or transferring insurance you have with other funds, changing your work category and changing your IP waiting and/or benefit period.

Changes can be made to your cover at any time. However, if you don't make an election to keep your cover as outlined in Option 1 above, you may still be at risk of losing your insurance because of the PMIF reforms. 

Option 3: Cancel your insurance with us

If you want to cancel the insurance you currently have with us, you'll need to complete a Reduce or Cancel Insurance Form and return it to us. Your cover will be cancelled from the date we receive your form.

Option 4: Do nothing

You're not required to take any action. However, your current insurance cover will remain at risk of being cancelled effective 1 April 2020 if your account balance has never been $6,000 or more after 1 November 2019.

How do I know if my insurance will be cancelled?

If our records showed that your balance was below $6,000 as at 1 November 2019, you would've received an email or letter from us outlining the PMIF reforms, if you're at risk of losing your insurance, and what you can do to keep your cover. If you haven't received any emails or letters from us about these reforms, call us on 1300 130 780 to see if they'll affect you.

My balance is currently below $6,000, but I haven't received any letter or email from you.

We've only contacted members whose balances were below $6,000 as at 1 November 2019. If your balance was above $6,000 on that date but has since gone down, your insurance will not be cancelled as a result of the PMIF reforms.

I received my letter, but I've lost it and now I don't know how to elect to keep my cover.

You can elect to keep your cover by following the instructions under Option 1 above. Alternatively, call us on 1300 130 780 - we can send you a link to an online portal, as well as your unique six-digit access code that was provided in your letter.

How do I know if I actually have insurance?

Call us on 1300 130 780 and we can tell you what insurance cover you currently have, and whether you're at risk of losing it as a result of the PMIF reforms.

I currently don't have insurance, but would like to obtain cover. Will these reforms affect any new cover I apply for?

Yes. If you decide to obtain insurance through LUCRF Super before 1 April 2020 and your account balance has never been $6,000 on or after 1 November 2019, we'll cancel your insurance cover effective 1 April 2020 unless you elect in writing to keep your cover. If you choose to apply for insurance with us, you can elect to keep your cover in these circumstances by completing the Insurance Election Form and/or the Income Protection Form.

Wait, didn't I already tell you I wanted to keep my insurance with you?

If you joined LUCRF Super after 1 July 2019, you may have already opted-in to keep your insurance cover. If you have, you don't need to provide a new election. If you're not sure, call us on 1300 130 780 and we'd be happy to check for you.

My account balance is currently zero. Do I actually have insurance?

You can only hold insurance on your LUCRF Super account if there's enough money in your account to pay your premiums from the date your cover started. If there aren't enough funds, the insurance on your account may be cancelled or subject to limitations.

If you want to keep the insurance on your account and your balance is currently zero, you'll need to:

  • check with us to confirm your insurance has not been cancelled
  • make sure your account has enough money to pay premiums, and
  • follow the instructions under Option 1 above.

If you'd like more information about your cover or your LUCRF Super membership, call us on 1300 130 780 or email mypartner@lucrf.com.au.

I have insurance on my retirement pension account. Is it still at risk of being cancelled?

Yes. The PMIF reforms apply to all accounts with insurance. If you have a retirement pension account, it's also important to note that:

  • Your insurance cover will automatically cease when you turn 70 (as cover is not offered beyond this age).
  • You won't be able to change any existing cover or apply for new insurance cover on your pension account once it's been removed.
  • You can cancel your insurance at any time.

If you have a retirement pension account and want to make sure the insurance isn't cancelled as a result of the PMIF reforms, follow the instructions under Option 1 above.

I have a transition to retirement (TTR) account. Do these changes apply to me?

Yes, because you might also hold a super account with us which could have insurance. If your super account hasn't been $6,000 or more after 1 November 2019, any insurance you hold on this account is at risk of being cancelled. This applies even if the balance of your TTR account pushes the overall funds you have with us to $6,000 or more.

If you want to make sure the insurance on your super account isn't cancelled as a result of the PMIF reforms, follow the instructions under Option 1 above.

If my insurance is cancelled, what happens to the cover I've already paid for?

You may still be able to make a claim for an event that happened before the date your cover was cancelled. However, you won't be able to claim for any future conditions or events occurring after the cover cancellation date.

I'm currently waiting on the outcome of an insurance claim. Will my claim be affected?

No. The changes under the PMIF reforms will not affect any claim you've made that's currently being assessed and/or processed.

What happens if I miss the deadline but want to keep my cover?

If your insurance cover is cancelled on 1 April 2020 as a result of the PMIF reforms, and you didn't provide us with an election to keep it, you can apply to recommence it by completing an application form available on our website soon or by calling us on 1300 130 780. We must receive your application to recommence cover by 31 May 2020.

If it's approved by our insurer, there may be a gap in cover between the date it was cancelled and the date it recommenced. You won't be insured for any events during this period. There may also be special recommencement terms that apply. If you want to apply for cover after 31 May 2020, you'll need to complete an Insurance Election Form and/or an Income Protection Form available at lucrf.com.au.

What if I choose to keep my cover, but stop receiving super contributions from my employer?

Once you've elected to keep your cover, your election will apply for as long as your account is open. It will remain in place even if your contributions stop or change (e.g. you become self-employed). You can cancel or change your insurance cover at any time.

Thinking about joining us?

You'll automatically be allocated a default level of Death & TPD insurance. Click here to find out how much default cover you're eligible for.

However, if your account balance has never been $6,000 after 1 November 2019, we'll cancel your insurance cover effective 1 April 2020 unless you elect in writing to keep your cover.

What are my options?

Consider whether any insurance cover you have with us suits your personal circumstances, based on things such as:

  • your current age
  • whether you have a partner or dependants who rely on your income
  • your debts and living expenses
  • any insurance cover that you have with other super funds
  • any insurance cover that you have outside of super
  • the cost of maintaining your insurance and the impact this may have on your account balance.

We've outlined a number of options available to you regarding your insurance with LUCRF Super as follows.

Option 1: Elect to keep the insurance you have with us

To keep your insurance with us, complete and sign this insurance opt-in form. Return the form to us before 31 March 2020 to avoid the risk of having your insurance cancelled on 1 April 2020. We must receive your request by this date, so allow time for delivery if you're posting the form.

Option 2: Make changes to the insurance you have with us

You can apply to increase, reduce or convert your Death & Total and Permanent Disablement (TPD) or Death Only cover and/or apply for or increase your Income Protection (IP) cover (subject to terms and conditions) by calling us on 1300 130 780 or completing the relevant forms. Other changes you can make include matching or transferring insurance you have with other funds, changing your work category and changing your IP waiting and/or benefit period

You can make changes to your cover at any time. However, if you don't make an election to keep your cover as outlined in Option 1 above, you may still be at risk of losing your insurance because of the PMIF reforms.

Option 3: Cancel your insurance with us

If you want to cancel the insurance you currently have with us, you'll need to complete a Reduce or Cancel Insurance Form and return it to us. Your cover will be cancelled from the date we receive your form.

Option 4: Do nothing

You're not required to take any action. However, your current insurance cover will remain at risk of being cancelled effective 1 April 2020 if your account balance has never been $6,000 or more after 1 November 2019.

You won't be provided default insurance if:

a. your super or retirement pension balance is less than $6,000, or

b. you're under 25*.

You can, however, choose to apply for insurance with us by completing the Insurance Election Form and/or the Income Protection Form.
*Please note: When you turn 25, you won't be eligible for automatic default insurance if your account balance is less than $6,000.

What happens from 1 April 2020 if my account balance reaches $6,000 for the first time and I'm 25 or over?

Default insurance cover will be applied to accounts without insurance, subject to eligibility and specific terms.

 

The PMIF reforms refer to a "dangerous occupation exception". What does this mean?

An exception to the application of the PMIF reforms is the "dangerous occupation exception". This applies to a member who is under 25, is engaged in a nominated dangerous occupation and joins a super fund on or after 1 April 2020.

Currently, LUCRF Super has chosen not to elect to apply for a dangerous occupation exception in regard of any dangerous occupations. This means that the PMIF reforms will apply to members even if they work in a dangerous occupation. If our position changes, we'll post information on lucrf.com.au and any members will be notified if this exception applies to them.

Will a Significant Event Notice (SEN) be issued?

Yes. We'll be sending all of our current members an SEN before 1 April 2020.

Where to find out more

Detailed information about the cover available to our members is contained in the Super Member Guide Product Disclosure Statement (PDS) and the Insurance Guide (which forms part of the PDS).

You may also wish to seek financial advice to help you decide how to meet your insurance needs. More information on insurance cover and super is available at the Australian Securities & Investments Commission consumer website, and in the insurance section on our own website.