The Federal Government will ease the process for consumers to opt out of group life insurance schemes with the current arrangements being labelled ‘ridiculous’ by the Minister for Revenue and Financial Services, Kelly O’Dwyer.
O’Dwyer made the announcement as part of a series of wider reforms to superannuation stating the Federal Government has “…tasked APRA with making it easier for consumers to opt-out of automatic life and disability insurance policies provided through superannuation”.
While specific details of a revised opt-out scheme have yet to be released O’Dwyer stated in a number of media interview following the announcement that the Government was concerned about life insurance eroding superannuation balances and the process used to opt-out of life insurance inside superannuation.
Speaking on the ABC AM program O’Dwyer said there was currently 2.7 million Australians with more than two superannuation accounts who were unable to simply opt-out of the default automatic group insurance schemes.
“…a lot of people can’t simply pick up the telephone or get online and simply opt-out…”
O’Dwyer said “…you’d be horrified to learn that in today’s day and age, a lot of people can’t simply pick up the telephone or get online and simply opt-out” adding that “…some people have to pick up a pen and piece of paper and post it in in order to actually opt-out”.
In an interview on 2GB radio, O’Dwyer said some current paper based arrangements require a Justice of the Peace to certify a member’s identity before they can opt-out.
“Now that’s quite clearly ridiculous when a lot of people would be looking at their statements online, where a lot of people would be using their phone to be able to telephone their funds, why can’t they use those devices to be able to opt-out of these arrangements?,” O’Dwyer said.
