With major changes for Insurance in Superannuation being a hot topic in the industry, the AIST Insurance in Super Symposium was due to have some lively discussion and it didn’t disappoint.
Key topics were the recent changes implemented under the Protect Your Super Bill (PYS). There was some reflection on how that was rolled out by the regulators (particularly around the short timeframe) and the Trustees communication to its members. Not to mention the large responses generated by members to their funds.
Also discussed was the recent passing of the Putting Members Interests First Bill 2019, fondly referred to as PMIF or PM-IF (not sure if we have a common pronunciation of this acronym in the industry yet!) and how Trustees can clearly communicate to affected members on how this will affect them and that they need to take action if they want to keep their insurance cover.
For those not familiar with the bill, from 1 April 2020, members under 25 years old and/or any members with less than $6k in their account will need to ‘Opt-In’ for insurance cover. The key challenge is that the demographic this change largely affects are known to be highly disengaged with super and have trust issues with financial institutions.
With the recent changes under PYS where members also had to ‘Opt-In’ for cover, there seems to be a split of opinions within the industry on the interpretation of the changes on whether members that have already ‘Opted In’ under PYS need to be asked to ‘Opt-In’ again under PMIF.
This was raised with both ASIC and APRA at the Symposium, who were both represented at the event. The answer from them was yes, but it looks like further discussion and clarification is still required.
Other key points raised during the event where around the amount of data that is now available and how better analysis of this data is required so that more tailored and proactive actions can be taken to improve a member’s health during a claim.
There will also be a focus on ensuring that members are still getting value for money for their insurance cover as a result of the changes. This is on ASIC’s Radar so Trustees should keep this in mind.
With great speakers and representation of delegates across Super and Insurance in attendance (there was even mention of a frozen chicken!), this was another well-organised event by AIST.