Planner’s actions no excuse for super fund member’s insurance lapse
The fact that a financial planner filled in a superannuation fund application form and associated insurance documentation on behalf of a client did not absolve the client of responsibility when he lost insurance cover, according to a determination by the Superannuation Complaints Tribunal (SCT).
Dealing with a complaint which could have implications for the Government’s changes to insurance inside superannuation, the Tribunal noted that the superannuation fund member had suffered an injury but because he had not maintained fund contributions he had no total and permanent disability (TPD) cover.
On the question of the role financial planner, the SCT determination noted that the complainant had conceded he had signed an application form for superannuation fund membership “but contends the financial planner filled out the forms on his behalf and failed to give him the opportunity to complete the forms in his own time”.
“If indeed this did occur, then it is a matter that the complainant should raise with the financial planner,” the determination said.
The SCT had been told that the complainant had joined the superannuation fund in February, 2003 but that the superannuation fund received the last superannuation guarantee contribution from the employer in April, 2004 with the fund writing to the complainant in March, 2014 to inform him the balance of his account was insufficient to pay insurance charges.
It was told that a further letter was sent to the complainant in April, 2014 informing him of insufficient funds and then again in May that year telling him his insurance cover had been cancelled.
The SCT was told that the complainant suffered an injury rendering him unable to work in June, 2014.
The Government had moved to make insurance inside superannuation opt-in for members aged under 25 or with account balances below $6,000.
Recommended for you
With an advice M&A deal taking around six months to enact, two experts have shared their tips on how buyers and sellers can avoid “deal fatigue” and prevent potential deals from collapsing.
Several financial advisers have been shortlisted in the ninth annual Women in Finance Awards 2025, to be held on 14 November.
Digital advice tools are on the rise, but licensees will need to ensure they still meet adviser obligations or potentially risk a class action if clients lose money from a rogue algorithm.
Shaw and Partners has merged with Sydney wealth manager Kennedy Partners Wealth, while Ord Minnett has hired a private wealth adviser from Morgan Stanley.
