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. existing members whose super or retirement pension balance was less than $6,000 and has never been $6,000 or more on or after 1 November 2019, and
  2. new members under 25 and new members with less than $6,000 who open a 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?

These new reforms mean that if your super or pension balance was below $6,000 as at 1 November 2019, any insurance cover you had with us would be cancelled effective 1 April 2020, unless:

  • you elected in writing that you wanted to keep it before 1 April 2020, or
  • your balance went above $6,000 or more at any time between 1 November 2019 and before 1 April 2020.

If you didn't have insurance on your account, these reforms will not affect you unless you decided to apply for cover after 1 November 2019 and before 1 April 2020 (see "I applied for insurance after 1 November 2019..." 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.

This is general information only and has been prepared without taking into account your personal financial situation, objectives or needs. General information is not advice. You should assess your personal financial situation before making a decision about LUCRF Super. To help you decide we recommend you read our current Financial Services Guide (FSG) and Product Disclosure Statement (PDS).

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

Option 1: Recommence the cover that was cancelled on 1 April 2020

If your insurance cover was 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 to Recommence Cover Cancelled Due to PMIF. We must receive your completed application form by 31 May 2020.

If your application is approved by our insurer, there may be a gap in cover between the date it was cancelled and the date it recommences. You won't be insured for any events during this period. There may also be special recommencement terms and conditions that apply, so please see our Insurance Guide for more details.

If we do not receive your completed form by 31 May 2020, you won’t be able to apply to recommence your insurance on a similar basis as held previously. Instead, you’ll need to apply for new insurance cover by completing an Insurance Election Form, and the insurer may require you to provide additional medical evidence.

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 your cover was cancelled on 1 April 2020 under the PMIF reforms and you choose not to recommence it as outlined in Option 1 above, you won’t be able to apply to recommence your insurance on a similar basis as held previously. Instead, you’ll need to apply for new insurance cover, and the insurer may require you to provide additional medical evidence. 

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, if your cover was cancelled on 1 April 2020 under the PMIF reforms and you choose not to recommence it as outlined in Option 1 above, you won’t be able to apply to recommence your insurance on a similar basis as held previously. Instead, you’ll need to apply for new insurance cover, and the insurer may require you to provide additional medical evidence.

How do I know if my insurance was 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 were at risk of losing your insurance, and what you could 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 your account was affected.

I received my letter, but lost it and now my cover has been cancelled.

You can apply to recommence your cover by following the instructions under Option 1 above (in "What are my options?"). Alternatively, call us on 1300 130 780 and we can help.

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 it was cancelled as a result of the PMIF reforms.

I applied for insurance after 1 Nov 2019 and before 1 April 2020. Will these reforms affect the cover I applied for?

Yes. If you obtained insurance through LUCRF Super between 1 November 2019 and 31 March 2020 and your account balance was never $6,000 or more during that period, your insurance cover would’ve been cancelled effective 1 April 2020 unless you elected in writing to keep your cover. If your cover was cancelled under the PMIF reforms, you can choose to recommence it as outlined in Option 1 above (in “What are my options?”).

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
  • If your insurance has been cancelled and you’d like to keep it, 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. How do I know if it was cancelled?

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.

You can call us on 1300 130 780 to check if the insurance on your pension account was cancelled under the PMIF reforms. If it was, you can choose to recommence it by following 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 was never $6,000 or more between 1 November 2019 and 31 March 2020, any insurance you had on this account would’ve been cancelled effective 1 April 2020 unless you elected in writing to keep it. This applied even if the balance of your TTR account pushed the overall funds you have with us to $6,000 or more.

If the insurance on your super account was cancelled as a result of the PMIF reforms, and you’d like to apply to recommence it, 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 if I chose 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 and there's enough money available to pay premiums. 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.

From 1 April 2020

You won't be provided default insurance if:

a. your super 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 Elect Default Insurance Form (when you first join us), or the Insurance Election Form and/or the Income Protection Form.

What happens when my account balance reaches $6,000 for the first time and I'm 25 or over?

You’ll automatically receive default cover on your account from the first day you’re 25 years or older and your account balance is greater than $6,000, if:

  • you’re working
  • your account has received a Superannuation Guarantee (SG) contribution from your employer
  • your account has had no previous insurance cover, and
  • you haven’t told us that you elect not to have insurance cover on your account (i.e. you ‘opt out’ of insurance cover).

You can let us know if you don’t want to accept this default cover by completing an Opt-out of Automatic Default Insurance Form any time prior to becoming eligible. However, if default insurance has commenced and you do not want to have it, you must tell us within 60 days of the date the cover commenced for it to be removed without having any insurance premiums deducted from your account..

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.

Have you issued a Significant Event Notice (SEN)?

Yes. An SEN was issued on 19 March 2020. You’ll find it here.

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's consumer website, and in the insurance section on our own website.