•   
  •   

AustraliaSuper fund members unhappy about insurance price hikes

19:36  12 june  2019
19:36  12 june  2019 Source:   abc.net.au

ANZ sells off life insurance business for $2.8b

ANZ sells off life insurance business for $2.8b 500 staff will move to Zurich after the sale as part of the bank's plan to simplify its operations.

Wayne Andrys was so happy with his super fund LUCRF that a decade ago, he convinced his wife to move her savings across to it.

Super fund members unhappy about insurance price hikes© Provided by ABC News Wayne Andrys, pictured with wife Elizabeth, says the changes to their life insurance with LUCRF are "a joke". "I said to my wife, 'Come over to LUCRF, it's a really good superannuation fund,'" he said.

"I thought it was the superannuation for us into the future."

Super fund members unhappy about insurance price hikes
Credit Cards Are Now Offering 0% Interest Until 2020
Find out more on Finder
Ad Finder.com.au

For the entire time they have been with LUCRF, Mr Andrys and his wife Elizabeth have been paying for life insurance. For Mr Andrys, who is 63 and works as a storeman, his $162,000 life insurance coverage costs him $7.68 a week.

Crusaders star Will Jordan confirms Super Rugby future

Crusaders star Will Jordan confirms Super Rugby future Star Crusaders fullback Will Jordan has confirmed his Super Rugby future by signing a new a new three-year deal with the Crusaders. The re-signing of the 21-year-old ends speculation of a potential move to the Highlanders, who are looking to replace departing long-time, France-bound fullback Ben Smith. Although currently out of action due to a foot injury, the former 2017 World Junior Player of the Year nominee has been in spectacular form for the Crusaders in his debut Super Rugby campaign, scoring eight tries in as many appearances.

Ms Andrys, who is 61, has $264,000 cover because her white-collar job is seen as less risky.

Mr Andrys said he wanted to make sure his wife and family were looked after if anything happened to him.

"The reason for the death cover was to cover any outstanding bills and debts that are there. And there's a few there, and I'm sure most of the members are in the same boat," he said.

But in April, the Adelaide couple received unwelcome news.

LUCRF said it was repricing its insurance and members aged over 55 would now be paying more and getting less.

Mr Andrys' premiums were to jump from less than $8 per week to more than $11 per week.

Meanwhile, their coverage was being slashed. Mr Andrys' cover would drop from $162,000 to just $54,000, while Ms Andrys' cover would drop from $264,000 to $96,000.

Record deal: Starwood snaps up Chatswood's Zenith Centre for $438.2 million

Record deal: Starwood snaps up Chatswood's Zenith Centre for $438.2 million US giant fund manager Starwood has cemented footprint in Australia after paying $438.2 million for the Zenith Centre office complex at Chatswood.

"It really is a joke and a slap in the face to all those people that have worked hard all their lives knowing they had that security blanket sitting there for them," Mr Andrys said.

"It's been taken from underneath them."

Super fund members unhappy about insurance price hikes© ABC LUCRF Super is making changes to its insurance premiums for over 55s from July 1. After contacting LUCRF to register their anger, they received a second letter from the fund.

It said they could keep their level of cover but at a cost.

Instead of paying $7.68 a week, Mr Andrys would need to pay $34.27 a week — a nearly 450 per cent increase.

His premiums would cost nearly $1,800 a year.

"Our coverage is going to drop dramatically, our payout figures are going to drop dramatically," he said.

LUCRF was unavailable for an interview, but in a statement to 7.30 said "recalibrations undertaken by LUCRF Super aim to evenly and fairly reflect the true cost of insurance cover as the membership's profile evolves over time".

Super Switch: Lachlan and Tyler face-off

Super Switch: Lachlan and Tyler face-off The first week of relationship experiment The Super Switch sees the six couples participating find out who they’ll be matched with, before laying down the rules about what happens when they share a bed. 

"The changes introduced will make insurance fairer by ensuring young members do not unfairly pay more in order to subsidise claims made by older members."

But Mr Andrys was not satisfied with the company's response.

"My argument is you didn't show due diligence to your members 10 years ago, when you should have been making adjustments then. And that's just purely bad management," he said.

'I was gutted'

Super fund members unhappy about insurance price hikes© ABC News: Xinhui Wang Bernard and Pamela Oldfield have been told their insurance premiums with LUCRF will dramatically rise. LUCRF has around 160,000 members and said 80 per cent of its members would be positively affected by the change.

But that meant roughly 32,000 members would be worse off than they were previously.

In Melbourne, Pamela Oldfield and her husband Bernard are both 63 years old and are being hit by the changes.

They have their superannuation with LUCRF and said their life insurance provided peace of mind.

"Because it's still a safeguard for if one of us passed, and they are covered, and they've still got this other bit of income coming in as well as covering funeral costs and stuff like that," Ms Oldfield said.

Two women, one name, and the $11k super swap

Two women, one name, and the $11k super swap A woman says she's had to change her name after authorities repeatedly confused her with a stranger with whom she shared a name and a birthday. Skylar Atwood was born Jessica Taylor on January 9, 1992, as was another Jessica Taylor whom Skylar now lives just 50km away from. Two years ago, Skylar started getting strange calls from finance companies, stating she had a different email with a different name. © A Current Affair Skylar Atwood was born with a different name, but official mix-ups led to her changing it. "I went to look at my super in my mygov account and tried to merge them all together," she said.

Their insurance premiums were due to drastically hike on July 1.

Ms Oldfield's $53,1400 coverage would go from costing $2.56 a week to $11.42 a week, while Mr Oldfield's $26,570 coverage would go from costing $1.28 a week to $6.40 a week.

"I was gutted more than shocked," Ms Oldfield said.

"I thought, how can these people do this? We've been paying it all our lives.

"Here we are now coming near retirement, and maybe we'll never use it, but you don't know.

"You can't see into the future."

Big changes coming to super

Super fund members unhappy about insurance price hikes© ABC News: Alex McDonald Xavier O'Halloran is acting director of the Superannuation Consumers' Centre at Choice. Xavier O'Halloran is an expert on superannuation with consumer advocates Choice.

"I've got a lot of sympathy for the people that are getting shocked with huge premium increases," he said.

"It comes across as really unfair. And I think a lot of the communication from the superannuation funds could have been better to explain why these prices were necessary."

He said LUCRF's previous insurance model was unusual and unfair.

"The way the insurance product is structured across this fund is quite unique," he said.

"A lot of funds will price in terms of risk, whereas this fund has pretty much had a flat rate across their entire membership."

But LUCRF was not the only superannuation fund rejigging its insurance offering.

Norway's $US1 trillion ($AU1.4 trillion) sovereign wealth fund to dump billions in coal investments

Norway's $US1 trillion ($AU1.4 trillion) sovereign wealth fund to dump billions in coal investments The world's largest sovereign wealth fund will divest from a slew of coal companies and oil explorers and producers, after Norway's parliament approved tighter investment rules. 

There will be major changes to all superannuation accounts from July 1, with a suite of reforms called "Protecting Your Super" due to begin.

People who have multiple superannuation accounts will no longer automatically take out insurance on all those funds.

One reform will make insurance opt-in for consumers whose accounts have been inactive for 16 months. This means less accounts paying insurance premiums — which means insurance costs will go up for some people.

"Some of the changes related to protecting your super are seeing premium rises across the board. And that was expected," Mr O'Halloran said.

"Because a lot of the duplicate funds are getting taken out of the system, it means that there are less funds and less premiums going into the hands of insurance

LUCRF said its changes to prices have nothing to do with these reforms, and that they came about because of an independent review of their insurance offering.

Super fund members unhappy about insurance price hikes© ABC News: Sarah Jaensch Bernie Dean from Industry Super Australia. 'No single rule applies to all super funds'

Bernie Dean is chief executive of Industry Super Australia boss, which represents superannuation funds like LUCRF. He said each fund must individually decide on the best pricing structure for their insurance offering.

"There's no single rule that applies to all super funds," he said.

"Super funds can have very different memberships. We have some super funds that have aging memberships and others that have very young demographic.

"The Government's changes recognise that these decisions are best left for the trustees of funds. And when it comes to not-for-profit and industry super funds, specifically, it's the members' interests that really drive that decision-making."

He said now is a good time for members to contact their funds to make sure they have got the right product.

"What we're finding is that many people are realising for the first time that they've had insurance within superannuation and that insurance might not have been appropriate for them. So by turning off that insurance, or modifying it, they're actually getting a boost to their super account," he said.

Pamela Oldfield said LUCRF's hikes are too big and unfair, so she will be dropping the insurance.

"We are going to fill out the form and say cancel it," she said.

"And we're also looking into our superannuation, looking at other options to move that on too."

Read more

Can't decide between a car or a house? These are some other financial goals to consider.
Starting to earn some money but not sure what you should be doing with it? We've asked some experts about some investing options. 

—   Share news in the SOC. Networks

Topical videos:

usr: 3
This is interesting!