POWERED BY MOMENTUM MEDIA
FSC to ban occupational exclusions
The Financial Services Council (FSC) is banning occupational exclusions in default group life insurance in superannuation for its super and life insurance members from 1 January, 2023, following a period of consultation.
The ban would be part of an enforceable FSC standard to prohibit the use of exclusions and restrictive disability definitions because a super member is employed in a high-risk occupation.
The ban also followed the Your Future, Your Super stapling reforms that would see some consumers unable to claim on life insurance cover because the fund had occupational exclusions in its default group life insurance.
The enforceable FSC Standard would:
- Apply to all default cover for Life Insurance, Total and Permanent Disability and Income Protection insurance in MySuper and Choice products; and
- Prohibit the use of exclusions and restrictive disability definitions because a member is employed in a high-risk occupation.
The FSC said it recognised that Australians must be able to claim on the default cover that they have been paying for through their super.
The ban, however, did not prevent trustees from choosing not to offer cover to a new member based on their occupation when the member joined the fund. In these circumstances the member would not be charged insurance premiums. The standard would also not apply to individually underwritten life insurance in super.
The target date of 1 January, 2023, would be subject to further consultation with regulators and the Australian Competition and Consumer Commission.
It said the 12-month transition period would allow trustees and life insurers to re-negotiate existing group life policies that were in place and to engage with members.
Recommended for you
The insurance company has joined this year’s awards as a principal partner.
The $135 billion fund has transitioned away from TAL Life Insurance following an “extensive tender process”.
The $80 billion fund is facing legal action over allegedly signing up new members to income protection insurance by default without active member consent.
In a Senate submission, the Financial Services Council has once again called for further clarification that the government will assess the consumer outcomes of group insurance against the enshrined objective of superannuation.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
61.07 3 y p.a(%)
2
Spire Oaktree Opportunities XI First Close USD
59.21 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.56 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
31.06 3 y p.a(%)
5
DomaCom 4/27 Crombie Avenue Bundall QLD 4217 Australia
26.81 3 y p.a(%)
