The retirement savings of Australians will be protected from inappropriate insurance with the passage of legislation through the Parliament today.
The Treasury Laws Amendment (Putting Members' Interests First) Act 2019 will require insurance in superannuation for new members under 25 and members with low balance accounts to only be offered on an opt-in basis from 1 April 2020.
It means the hard-earned retirement savings of millions of Australians will be protected from undue erosion through inappropriate insurance arrangements.
Importantly, these changes will not prevent anyone who wants insurance within superannuation from being able to obtain it: low balance account holders and young members will still be able to opt in if they want to take out insurance.
Additionally, under the reforms passed today, a targeted exemption will allow trustees to elect to provide insurance on an opt-out basis to members employed in emergency services such as police, ambulance officers or firefighters, or other workers employed in the top 20 per cent riskiest occupations.
The Morrison Government is putting the interests of members, not insurers or funds, first.
These changes build on earlier reforms passed in February 2019 which will result in millions of Australians being reunited with billions of dollars worth of superannuation.
These laws also banned exit fees and excessive fees on low balance accounts, saving 7.2 million Australians more than half a billion dollars in the first year.
With over 15.6 million Australians with a superannuation account and around $2.9 trillion worth of superannuation savings, making our superannuation system work for members is part of the Government's plan for a stronger economy.