More than half of Australians unaware of superannuation shake-up

An estimated 3 million people could be affected by the upcoming superannuation changes - which could lead to a loss of their insurance money.

More than half of all Australians are unfamiliar with upcoming superannuation changes, which could see some people actually losing money, new data has revealed.

From 1 July, life and disability insurances will lapse if your superannuation account has been inactive for 16 months. Those with an inactive account are urged to contact their super holder and "opt in" to the new scheme, if they want to keep the cash.

But, people with low balance accounts - containing less than $6,000 - will also be affected by the shake-up.

More than half of all Australians are unaware of the new super shake-up, according to new data.

The CEO of the Association of Superannuation Funds of Australia Dr Martin Fahy told SBS News a large number of Australians will be affected by the changes.

“We estimate that as many as 3 million Australians could be impacted by these changes to super on 1 July and the research that we’ve done shows that more than half of Australians, 53 per cent, are unaware of the changes that are going to happen to their life insurance cover on that date.”

Dr Fahy said that’s a very high number, given that almost three-quarters of Australians have some form of insurance attached to their superannuation fund.

The changes have been designed to ensure superannuation balances are not being eaten up by insurance premiums and fees.

But they could negatively affect some vulnerable people, who could lose their insurance unless they take action this month.

This includes people from a migrant background, people who are hard to get in touch with, such as those living remotely, are travelling, or have moved house, or people on extended sick or paternity leave.

“The real concern we have is that people will be left exposed in the event of a tragedy," Dr Fahy said.

A new campaign was designed to raise awareness about the new superannuation changes.

He added that 70 per cent of people have their life insurance covered through their superannuation fund.   

ASFA has teamed up with the Financial Services Council to raise awareness about the changes by launching a marketing campaign. Many superannuation funds have also contacted their affected members. 

“The purpose of the campaign we are running is to get people to check their super and we’ve set up a site and what we want to ensure is that those who are exposed or vulnerable are not left high and dry in the event of a tragedy,” Dr Fahy said.

“When did you last check your Super”, is now running across TV, digital and social to urge Australians to contact their funds if they are affected."

People can also visit to see if the changes will affect them. 

Published 10 June 2019 at 4:03pm, updated 11 June 2019 at 7:59am
By Dubravka Voloder