Group insurance in superannuation and particularly its automatic issuance on an opt-out basis has been a successful policy for Australia which has resulted in better risk protection for Australians from all walks of life. It provides a safety net to millions of Australians who would have otherwise not chosen or been able to take out life and disability insurance individually. These benefits contribute significantly to addressing Australia’s underinsurance gap and relieving fiscal pressures on our social security system.
The Insurance in Superannuation Working Group (ISWG) was formed in November 2016 to collaboratively enhance future iterations of policy development. While the current policy settings are fundamentally right, there is industry acknowledgment that changes need to be made to improve the experiences of superannuation fund members.
A key deliverable for the ISWG is a Code of Practice that will apply to superannuation funds. This code will extend on the current FSC Life Insurance Code of Practice (FSC Insurer Code) by setting standards that ensure a common end to end experience for all classes of life insurance consumers.
This consultation paper outlines the content of the draft Insurance in Superannuation Code of Practice (Code), the full text of which is included as Appendix 1. Feedback received during stakeholder consultation on this paper will be incorporated into the development of the Code, prior to a final version being approved and published by the end of 2017.
Unless stated otherwise, the statements in this paper reflect the views of the ISWG as a collective.