In a statement, ISA said it will work with Ms O’Dwyer – named this week as the Minister for Revenue and Financial Services – on major changes to superannuation and financial services proposed earlier this year.
“In particular, the 2016 Budget reforms to make super more sustainable and equitable must remain a legislative priority in the next sitting of the new Parliament,” said ISA deputy chief executive, Robbie Campo.
“New safeguards to address conflicted remuneration in the financial services industry, stronger product disclosure requirements and higher professional standards for financial planners are also essential to ensure consumers’ best interests are being strengthened in the wake of life insurance and other scandals in the ‘for profit’ sector.”
ISA added that it looks forward to an evidence-based discussion regarding the Productivity Commission’s inquiry into the efficiency of the superannuation system and processes for default fund selection.
“A large number of Australians rely on high-performing default funds to ensure a comfortable and dignified retirement. However, the poorer performance of many choice products and many SMSFs should flag the need for more effective consumer protections for members leaving or outside default arrangements,” Ms Campo said.
“The best interests of members must remain firmly at the centre of any proposal to widen and strengthen the existing default safety net.”
Is that the same ‘Best Interests Test’ that allows Union Super Funds to change the insurance definitions for their members to be amongst the worst in the industry?
Is the ‘insurance scandals’ Ms Campo referred to the one’s showcased by Adele Ferguson that were almost all cases concerned insurance within Union Super Funds? Obviously the fault of advisers there.
Can Ms Campo confirm whether Union Super Funds receive commissions from insurers when members apply for more than the default level of cover? We know from their advertising that they’ve never paid them to financial planners, but do they take them themselves? That wouldn’t be hypocritical at all would it…
Can Ms Campo confirm whether Union Super Funds participate in a profit sharing arrangement when claims are maintained below a certain threshold? No conflict there of course.
Can Ms Campo confirm that the trustees of certain funds have denied TPD claim(s) even though the insurer had approved the claim based on medical grounds? The example I’m referencing was were a long-standing member of a Union Super Fund was denied a claim by the fund trustees because the nature of her illness/injury had her off work on the day the underlying insurer changed over. So despite being a continuous member of the fund, she was deemed ineligible for cover by the trustee on a technicality, even though the insurer was prepared to pay the claim. Compare that Pair…