Many Australians have insurance inside their super account – the cost of which comes out of their super balance. But some don’t realise they have this insurance and may be paying for cover they don’t need or want.
The super laws
To prevent the erosion of super balances unnecessarily, the insurance inside certain super accounts was required to be cancelled.
- On 1 April 2020, super funds were required to cancel insurance inside super accounts where a super balance didn’t reach $6,000 by 1 April 2020.
- Insurance may also be cancelled if a super account doesn’t receive a contribution or rollover for 16 months.
Super members affected would have had an opportunity to tell us they wanted to keep their insurance before their insurance was cancelled under these super laws.
How to get your insurance back
If your insurance was cancelled under super laws, there may still be time to get it reinstated. Please check your cancellation letter for more details, and read the important details listed below.
You can ask for your insurance to be reinstated by doing one of these:
If you’re insured by AMP Life, fill out this online form . Please check your product disclosure statement (including the insurance guide) if you’re unsure of your insurer.
Complete the paper form we sent you with your cancellation letter. Then send it to:
AMP Life Limited
PO Box 300
PARRAMATTA NSW 2124
(no stamp required)
If your request comes through within the time provided in your letter, your insurance will be reinstated without needing to provide health and lifestyle information. If your request comes in after that, you may have to answer some health and lifestyle questions and you may not receive the same level of cover at the same price. Exceptions and eligibility rules may apply.
Important details before deciding
Use this guide to understand more about what the new super laws could mean for you.
Why is this happening?
Many Australians have insurance inside their super account – the cost of which comes out of their super balance. Yet some don’t realise they have this insurance and may be paying for cover they don’t need or want.
These super law changes aim to protect peoples’ retirement savings by preventing super balances from being eroded by the cost of insurance people may not want or need. Learn more.
What’s in the new laws?
In 2019, the super laws were introduced in two parts:
1. The first round, called Protecting Your Super, came in on 1 July 2019, focusing on insurance in inactive accounts. Learn more.
2. The second round, called Putting Members’ Interests First, came in on 3 October 2019. These laws require super funds to cancel the insurance inside low balance super accounts as at 1 April 2020, unless the balance reached $6,000 before 1 April 2020.
I’ve already heard from AMP about this.
It’s possible you’ve heard from us separately about the Protecting Your Super package and the Putting Members’ Interests First laws (see above).
To prevent your insurance from being cancelled under either law, you needed to request to keep your insurance prior to 1 April 2020.
I’ve already requested to keep my insurance.
If you made a request to keep your insurance prior to 1 April 2020, your insurance will not have been cancelled.
What does this mean for me?
What happens if my insurance has been cancelled?
The cancellation can mean different things for each type of insurance.
By no longer having Life insurance (also known as death cover), if you die, your dependents or other beneficiaries will not receive insurance benefits from your super account.
By no longer having Total Permanent Disability (TPD) insurance, you will not receive any lump sum insurance benefit from your super account if you become permanently disabled due to illness or injury.
By no longer having Temporary Salary Continuance (also known as Income Protection), you will not receive a monthly benefit (up to 75% of your pre-disability income and subject to a waiting period) if you are not able to work for a period of time due to illness or injury.
By no longer having Temporary Total Disablement Cover, you won’t receive a monthly benefit (up to 75% of your pre-disability income and subject to a waiting period) if you become Temporarily Totally Disabled due to illness, accident or injury.
What if I recently added an insurance type or increased my cover?
If you’ve added to, or increased your insurance since 1 November 2019, this additional or increased insurance may have been cancelled, unless you requested to keep it through our insurance opt-in form or your super balance reached $6,000 before 1 April 2020 (providing that your account was not “inactive”).
We’ve written to you to let you know if this happened.
If this is the case, you’ll still have the level of cover you had prior to 1 November 2019 though. This also means the cost of your premiums will also go back to what they were prior to 1 November 2019, subject to any age-based or CPI increases that may have occurred in the interim.
For example: If you had life insurance for $100,000 in October last year, and you then increased the value of your insurance to $120,000 in January this year, the difference of $20,000 may have been cancelled on 1 April 2020. If so, your insurance cover will go back to $100,000 from 1 April 2020, and you will pay premiums based on that amount.
Cancellation of insurance types may be subject to product rules. Call us on 1300 363 267 or refer to your PDS and Insurance Guide Fact Sheet (if applicable) for more information on the terms and conditions of your insurance cover.
What else do I need to know?
It’s important to understand your insurance, to know what’s right for you. Here are some things to think about:
It can be complicated for certain people to get insurance. E.g., if you have a pre-existing medical condition and your current insurance is cancelled under the new laws, you may not be able to reinstate your cover to the same benefit level or get insurance elsewhere at the same cost.
Product features like waiting or benefit periods can also vary between policies. Please check your most recent statement or product disclosure statement.
Payments for insurance inside super come out of your super balance, which means the balance can be reduced by costs over time. This is especially important when an account is inactive or has a low balance. This could reduce the amount of money available for you in retirement.
Make sure you understand the details of insurance inside super.
Some employers negotiate special deals for their employees, which you could be benefiting from.
You can get an idea for what your insurance needs might be by using our insurance calculator.
Your financial adviser can help you determine what insurance is right for your circumstances.
If my insurance has been cancelled, can I get it back again?
If your insurance has been cancelled under super laws, you may be eligible to reinstate your cover. Alternatively, you may be able to apply for new cover and supply health information. This information would need to be assessed as part of your application. It may not be possible to reinstate your insurance on the same terms or at the same price. And, in some circumstances, you may not be able to reinstate your cover at all.
What if I have more than one account?
If you have more than one AMP super account with a balance below $6,000 and you’d like to keep the insurance in each, you’ll need to act in one of the ways provided, for each account.
You would have received a notice from us about the insurance in your account if you’re impacted by these laws.
Remember, if you have two accounts with the same type of insurance (from one or more super providers), you may be paying for insurance you don’t need. In particular, for Temporary Salary Continuance (Income Protection), you will most likely only be able to claim up to 75% of your pre-disability income (offsets may apply), regardless of whether you hold it in two accounts.
It might be a good idea to speak with your financial adviser about super and insurance to meet your personal circumstances.
What are my options?
How should I respond?
It depends on what you’d like to do:
If you don’t want your insurance, you don’t need to do anything. Your insurance would have already been cancelled.
On the other hand, if you want to reinstate your insurance, you can fill out the online form or paper form provided. Details are provided in the notification we sent you.
What happens if I do nothing?
If you don’t wish to reinstate your insurance, your insurance will remain cancelled.
However, as soon as you meet the eligibility requirements under super laws, your insurance may be applied again automatically (you’ll be given the chance to let us know if you don’t want it though).
To be eligible to receive automatic (default) insurance with your employer super plan, you must:
- be 25 years old or over, and
- have a balance of at least $6,000 in your super account.
The exceptions are if you have previously told us you don’t want your insurance or if your account is inactive (no contribution or rollover into it for 16 months).
If insurance is applied, you’ll receive an insurance confirmation letter outlining your new insurance cover, the cost and the terms.
Making insurance claims
Can I still make an insurance claim on events that occurred before the cancellation date?
Also, where your premiums are paid in advance, you’re entitled to claim for the period you’ve paid up to. Please call us if you have any questions.
What happens if I already have an insurance claim?
If you have a claim with us, these new laws won’t impact your claim, and we’ll continue to support you throughout the process.
However, you'll still need to opt-in if you'd like to keep your other insurances inside your super account, claim on another insurance type (TSC, TPD or Death), or claim on the insurance inside your super account in the future. Call us for more information on 1300 363 267.
How do I find out how much super and insurance I have?
Using your account number, login to My AMP where you will find your super and insurance details in your annual statement or welcome pack. You can also call us on 1300 363 267.
Where can I find more information about the super laws?
We encourage you to visit these independent sites to help you better understand insurance inside super and the new laws:
The Australian Securities and Investment Commission (ASIC) offers helpful information via its website moneysmart.gov.au/superannuation-and-retirement/how-super-works/insurance-through-super#PMIF
The Australian Prudential Regulation Authority (APRA) supervises the financial services industry and offers more information at apra.gov.au/putting-members’-interests-first-–-frequently-asked-questions
You can also learn about:
How do I get in touch?
Call us with any questions about the super changes on 1300 363 267.
Or, email us at email@example.com.
All statements about insurance cover are general comments only and the specific terms and conditions of the relevant cover will need to be considered in the event of any claim.
Products in the Super Directions Fund and the Wealth Personal Superannuation and Pension Fund are issued by N.M. Superannuation Proprietary Limited (N.M. Super) ABN 31 008 428 322 (trustee), which is part of the AMP group (AMP). Before deciding what’s right for you, it’s important to consider your particular circumstances and read the relevant Product Disclosure Statement or Terms and Conditions available from AMP at amp.com.au or by calling 131 267. Read AMP’s Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relation to products and services provided to you.
Products in the AMP Eligible Rollover Fund, National Mutual Retirement Fund, and NM Pro Super Fund are issued by Equity Trustees Superannuation Limited ABN 50 055 641 757 (trustee). Risk products are issued by AMP Life Limited ABN 84 079 300 379 (AMP Life), which is part of the Resolution Life group. AMP Life has proudly served customers in Australia since 1849. AMP Limited ABN 49 079 354 519 has sold AMP Life to the Resolution Life group whilst retaining a minority economic interest. AMP Limited has no day-to-day involvement in the management of AMP Life whose products and services are not affiliated with or guaranteed by AMP Limited. AMP Limited is not liable for products issued by AMP Life or any statements or representations made in the PDS for those products. “AMP”, “AMP Life” and any other AMP trademarks are used by AMP Life under licence from AMP Limited. Before deciding what’s right for you, it’s important to consider your particular circumstances and read the relevant Product Disclosure Statement or Terms and Conditions available from AMP Life at amp.com.au or by calling 133 731. Read AMP Life’s Financial Services Guide for information about our services, including the fees and other benefits that AMP Life and/or other companies within the Resolution Life group may receive in relation to products and services provided to you.
Any advice and information provided is general in nature, hasn’t taken your circumstances into account, and is provided by AWM Services Pty Ltd ABN 15 139 353 496 (AWM Services), which is part of the AMP group (AMP). All information on this website is subject to change without notice.
Although the information is from sources considered reliable, AMP does not guarantee that it is accurate or complete. You should not rely upon it and should seek professional advice before making any financial decision. Except where liability under any statute cannot be excluded, AMP does not accept any liability for any resulting loss or damage of the reader or any other person.