Group insurance under political pressure

Group insurance under political pressure

Recent government moves making it easier to opt out of group insurance reflect a broader political scepticism about the benefits of insurance within superannuation, says former NSW Liberal leader Kerry Chikarovski.


Speaking at the Workplace Super Specialists Australia conference in Sydney on Friday, former NSW Liberal leader Kerry Chikarovski said there are "people sitting on both sides of the house who actually think that insurance within super is a complete rip-off".

The comments come after Minister for Revenue and Financial Services Kelly O'Dwyer announced in July that the government would make it simpler for Australians to opt out of insurance premiums that are "eroding their retirement savings".

According to Ms Chikarovski, there are two reasons underlining the political opposition to insurance being held within superannuation.

"First, even if people know they've got it, they have no idea what it actually covers and how much it's worth to them," Ms Chikarovski said.

"The second reason is that most people are completely disengaged with their super so they probably don't even know that they have [insurance].

"So as far as some of the politicians are concerned, if premiums keep reducing [super] balances there is no significant improvement for the individual in having that insurance."

The challenge for professionals in the superannuation and insurance industries is to make sure members understand how much insurance they hold, what they're paying for it in premiums and what it is worth to them, Ms Chikarovski said.

"Are people really getting value for money? And that's what the politicians are looking at," she said.

 

Group insurance under political pressure
Kerry Chikarovski, Liberal, superannuation
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