BUSS(Q), the Queensland-based building industry fund, has become the latest super fund to finalise a significant upgrade to its insurance offering to members.
Following negotiations with its long term insurer, ING, BUSS(Q) has announced that its members will gain an increase in their insurance cover of between 30 per cent and 66.67 per cent for a minimal premium rise. The bulk of members are currently on default cover, entitling them to $120,000 in the event of death. From October 1, this will increase to $200,000, a figure which David O’Sullivan, BUSS(Q) chief executive, said was more in line with covering outstanding mortgages. This news comes as part of growing trend in which super funds are using their large membership numbers and competitive insurance environment to demand superior insurance cover conditions. “We went back to [negotiate with] ING after more experience with claims from members, and they had a 22 per cent improvement in underlying rates that they could pass onto us,” O’Sullivan said. On raising the default level of cover, O’Sullivan said: “It’s necessary for trustees to show leadership in this space. We can’t say that we are able to offer better insurance but members have to choose it. Research has shown members have a low level of understanding and a high level of apathy.” Jason Clarke, of SuperRatings, said it was a common trend for super funds to improve their insurance offerings to members. Just in the past few months revamped insurance cover and/or reduced rates have been offered by NGS, Tasplan, Aon, InTrust and Health Super. Clarke said that insurers were becoming more competitive, helped by better recent claims experiences.
AustralianSuper’s appointment of a general manager, retirement to replace Shawn Blackmore, which follows ART's redeployment of Kathy Vincent to chief operating officer, shows that mega funds are back-pedalling on the strategy of having dedicated retirement C-suite executives. The role had been touted as the next big thing in super funds' organisational structures, but experts say what matters is there is senior accountability for decumulation.
Darcy SongDecember 4, 2024
