Group insurance delivered premium return to super fund
The Royal Commission has confirmed the benefit that superannuation funds gain from the group insurance premiums paid by members.
The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry heard that industry fund Hostplus benefited from the tax deductibility of the group insurance premiums.
Hostplus chief executive, David Elia confirmed that the tax deductibility equated to around 15 per cent of the premiums paid which amounted to about $14.5 million a year.
Asked why Hostplus retained the tax-deductible amount rather than distribute it to members, Elia explained that the nature of group insurance meant that the money retained in the fund was applied to the benefit of members.
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