Random MySuper transfers putting members at risk: CSSA
Superannuation members could be losing millions of dollars in insurance as their fund balance is transferred to a Government scheme which leaves “no avenue for compensation”.
Those are the fears of Corporate Super Specialist Alliance (CSSA) treasurer Gareth Hall, who says the arbitrary transition to MySuper funds for certain members has already begun.
'Flipped members’, who have transitioned from a corporate super plan to a personal super plan are starting to be moved into MySuper funds, well before the July 2017 deadline.
The most worrying aspect is the potential loss of insurance and lack of recourse, Hall said.
“We believe many members are not aware of the problem and consequently are losing millions of dollars in insurance cover, cover which they may never be able to obtain again.”
“How can any Government legislate the removal of such important benefits from taxpayers, and offer them absolutely no avenue for compensation?”
Ex-corporate super members are given the chance to state whether they want to retain their super arrangements, but Hall said he knows of at least one member who almost missed the opportunity to opt out of the transition.
“If this member had been arbitrarily transitioned into a MySuper fund, his current insurances would have been cancelled,” Hall said.
“Our gravest concern is what will happen to members who are not engaged. What if they have changed address or are on leave and are not able to be contacted? They will just lose out,” Hall said.
Recommended for you
AMP is to launch a digital advice service to provide retirement advice to members of its AMP Super Fund, in partnership with Bravura Solutions.
Unveiling its performance for the calendar year 2024, AMP has noted a “careful” investment in bitcoin futures proved beneficial for its superannuation members.
SuperRatings has shared the median estimated return for balanced superannuation funds for the calendar year 2024, finding the year achieved “strong and consistent positive” returns.
The second tranche of DBFO reforms has received strong support from superannuation funds and insurers, with a new class of advisers aimed to support Australians with their retirement planning.
