Updated: May 2020
MySuper is a simple superannuation product designed for those who do not want to make choices about their superannuation.
This page has some of the most common questions about MySuper and what it means for you.
Contents
- Why am I a member of a superannuation fund I did not choose?
- What is MySuper?
- Why am I paying for insurance cover?
- I heard the law has changed
- How do I keep track of my superannuation?
Why am I a member of a superannuation fund I did not choose?
Since 1 January 2014, employers must pay all superannuation guarantee (SG) contributions:
- into a MySuper product selected by the employer, or
- to a superannuation fund of the employee’s choice (if the employee tells their employer to do so by completing a ‘choice of fund’ form).
If you haven’t completed and given a ‘choice of fund’ form to your employer, your SG contributions must be paid to the MySuper product selected by your employer.
When a MySuper-authorised superannuation fund receives an SG contribution, superannuation legislation generally requires the fund trustee to pay that contribution into a MySuper account. If the person does not have a MySuper account with the fund, the fund trustee is required to open one to receive the SG contribution.
What is MySuper?
In September 2011, the Australian Government proposed a simple superannuation product referred to as ‘MySuper’. It is designed for people who do not want to make choices about their superannuation.
There are some special features for MySuper products, including:
- There is a single investment strategy.
- There are restrictions on the fees and costs that can be charged.
- There is often a requirement to provide ‘automatic’ insurance cover for death and permanent incapacity.
Information about MySuper can be found by clicking here.
Why am I paying for insurance cover?
Until recently, a fund trustee had to provide death and permanent incapacity insurance cover for MySuper products, unless the person tells the trustee that they do not want cover (sometimes called ‘opting out’ of cover). To provide cover, deductions of insurance premiums are made from the person’s MySuper account.
The fund trustee must provide information about:
- the amount of insurance cover provided
- the insurance premium that will be charged, and
- how a person can ‘opt out’ of or change insurance cover.
The fund trustee will generally do this in a welcome letter when a person first joins the fund. The fund’s product disclosure statement (PDS) must also contain information about how a person can ‘opt out’ of insurance cover.
If the law says you must have insurance cover with your MySuper product, the fund trustee must give you insurance cover (as long as it can obtain the cover from an insurer on reasonable terms).
I heard the law has changed
The government has recently made some changes to the law so that from 1 April 2020 death and permanent incapacity cover will not usually be provided for:
- people under 25 (unless you work in a dangerous occupation)
- people with superannuation account balances less than $6,000
unless you tell the fund trustee you do want insurance (sometimes called ‘opting in’ to cover).
Recent changes also mean that if your superannuation account has not received any contributions for 16 months, the trustee must cancel your insurance cover. The trustee will contact you before it cancels your cover.
Information about these changes can be found by clicking here.
How do I keep track of my superannuation?
Even though MySuper is designed for people who do not want to make choices about their superannuation, it is still important to read what the fund trustee sends you.
The fund trustee will send you a statement at least once each year where you can check what has gone into and out of your superannuation account and ask questions if you are unsure about anything.
With the new changes, the trustee may also send you notices about your insurance cover. It is very important to read these notices so that you don’t lose cover you need or pay for cover you don’t need.
AFCA finds that questions and complaints made right away are generally easier to resolve than those made a long time later.
