Industry super funds are working together to make consolidating multiple accounts easier for members, announcing a new initiative that should save eligible members an average $260 a year in fees and insurance premiums.
Eighteen industry superannuation funds have agreed to a collective cross-fund matching initiative that would be free of charge to members if a successful match is found.
The scheme would seek to automatically deploy 500,000 low balance inactive accounts in its first full-scale deployment, which the funds estimate could save members an estimated $100 million a year in duplicate fees and insurance premiums.
Industry Super Australia (ISA) chief executive, Bernie Dean, said the funds had been working on the scheme for over a year, including trialling a pilot last year which consolidated 50,000 accounts.
“It has been developed to cut through restrictive rules which limit the ability of funds to reunite members’ lost and inactive savings without first obtaining express consent,” Dean said.
“Once a match is found members will still be able to opt out, but a survey following the pilot found members who had accounts consolidated were very happy funds proactively chased their savings.
“This is the right thing to do for members – they expect the system to sort out multiple accounts for them. Industry super funds have been consolidating multiple accounts for many years, but it has relied on members kicking it off. This new initiative will cut through the red tape.”