More than 440 AMP customers want insurance reinstated

AMP has received more than 440 customer requests to reinstate insurance cancelled as a result of the Government’s Protecting Your Superannuation legislation and it is warning the situation could get worse if the Government does not delay the implementation of further legislation impact insurance inside superannuation.

AMP also revealed that more than 5,000 of its superannuation customers with inactive accounts under the new Protecting Your Super rules and with balances less than $6,000 had elected to retain their insurance.

In a submission filed with the Senate Economics Legislation committee, AMP said the proposed 1 October 2019 commencement date for the new legislation – the Treasury Laws Amendment (Putting Members’ Interests First) Bill 2019 did not provide sufficient time for customers impacted by the low balance account measure to comprehend the impact of the changes or consider their circumstances.

Related News:

“Based on customer responses to engagement in respect of the PYS changes, AMP does not believe sufficient time was provided for customers with inactive accounts to comprehend the impact of the changes, consider their circumstances and make an informed decision about whether to keep their insurance, before it was cancelled from 1 July 2019,” it said.

“Despite the considerable effort AMP made to communicate the PYS changes to our customers, and the combined efforts the industry made to raise awareness before and after 1 May 2019, as at 15 July 2019 we have received more than 440 customer requests to reinstate insurance cancelled as a result of PYS.

“This was a significant increase from the first week, where on 8 July we had received 47 customer requests for insurance reinstatement,” AMP said.

“We anticipate the number of insurance reinstatement requests to continue to increase as customers receive insurance cancellation notices.

“Based on the customer experience and response to the PYS changes which allowed for two months’ notice prior to cancellation, we believe that longer than two months’ prior notice is required to ensure customers with low balance accounts are not adversely impacted by the proposed PMIF changes.”




Recommended for you

Author

Comments

Comments

One company only....440 requests to reinstate cover already...many, many more to come across multiple superannuation funds and platforms.....limited and restrictive time frame to inform customers and members of the proposed changes leading directly into the end of a financial year....ridiculous legislation.....unintended consequences....lack of understanding by Govt......absolute mess.....financial impact if claims arise in the interim.
The most disturbing issue during this process was that if a member was already in the midst of the claim process or in fact receiving claim benefits, their insurance cover had the potential to be cancelled whilst on claim if they did not respond to inform their super fund they did not want their insurance cancelled.
Can you imagine a terminally ill super member dying of incurable cancer, who had already commenced the claim process for the early payment of their Life Insurance benefits being told their insurance benefit had been cancelled because they had not made a contribution to their super fund for the previous 16 months.!
Would the Govt have stepped in to support this person and their family?
Maybe with the Disability Support Pension which would have taken 6 months at minimum to process.
The Govt wouldn't have paid the individual or their dependents a lump sum to replace the insurance cover they had lost because of the negligent legislation forced upon members in a limited time frame.

Yep, better yet I have several cases with another provider where they received the 'opt in' letter and confirmed this but didnt process them before the cut off date. Insurance cancelled, were assured it will be reinstated and that they are currently covered, however, just shows how bad this was all thought out.

I agree enturely! Ill thought out Legislation!! My son has Muscular Dystrophy and is on a disability pension. Of course doesn't contribute anymore. I will sort this for him while I live but he'll lose it when I die! And 2 young children will be the ones to suffer. Scrap superannuation and start again. It is a terrible, horrible mess and the taxpayer doesn't know the fine print until it's too late and by then Governments and Funds don't care about you! All should be aware this will come up every 16 months if u don't contribute. Well done Stuart Robert and all politicians. Not justcthe Government but Labor were too busy skimming pensioners to take notice and the Greens! Well! Don't think they r even on this planet!

Nope, nobody saw this coming (sarcasm)!!!
This is what happens when politicians adopt 'knee-jerk' legislation to serve their political agenda without regard for consequence. Never mind, let's refocus parliament on the tortuous debate around religious freedoms.

I am one of the 440 people who had their insurance cancelled. I responded within the timeframe but seemed to have responded to the wrong inbox hence it apprarently wasn't received. i have a condition which would cause my insurance premium to increase significantly if I re-apply or i may not even be ble to get it!! I am really annoyed and have asked AMP to reinstate the cover. If they don't I could be financially ruined - or my family will be...whose fault is this? I would hope aMP are sensible and don't let the customers down like they have in the past

I don't work for AMP but I do work for another super provided so I'll just say "Don't worry!" - so long as you've told them - they will have (as we have) negotiated a significant "no fault" reinstatement period with their insurer in the full knowledge (as all super companies are) that this would happen. Just keep in touch with them about it, but don't panic.

Yes, all super funds are desperately attempting to process the cancellation /reinstatement notification as soon as possible.
The problem lies in the fact that if a member has received a cancellation notice and they die before the reinstatement option is enacted, who is liable for the insurance cover ?
Are they technically covered during this period ?
I don't believe they would be because they would not have been officially notified the insurance cover was active.
I would not wanting to be staring down the barrel of a death or TPD claim between the 1st July cancellation date and the reinstatement time frame.

You, and all those affected need to tell your Local MP - Tell them what is going on, so hopefully they listen and stop this mess.

Dirt poor, financially illiterate people with sweet fxck all superannuation are worried about loosing junk insurance.

The simple solution is to make all insurance opt in from the get go.

No more profiteering

Been in this fund for 30 years. Have paid super every month being a full time employee, but not much left in account. High insurance and admin fees have eaten the account like a starving man eating a buffet meal.

Did you access advice from a qualified adviser during this 30 year period or didn't wish to do so because of a perception the cost would not outweigh the benefit ?
Did you simply continue on without analysis, comparison or advice ?

So you are aware that you have insurance in your super that is eroding the balance. Yet you have chosen not to cancel that insurance. You want to blame someone else for your decision to spend your retirement money on insurance?

Funny how financial advisers are not alloed to cancel a client’s insurance without written authorisation but the government can cancel thousands of policies without even knowing if the client received the letter warning them about this.

Far too sensible would be to do it the other way around and ‘open out’ eg. make them put it in writing if they didn’t want it!

This ridiculous mess of a law will have far reaching consequences for years to come.

And please don’t blame your adviser or insurance provider, the government made the law.

I wonder which lobbyists and politicians organised insurance as opt out by default?

What a mentally retarded idea.

Surely now acknowledged as demonstrably flawed economic reasoning.

Generations of failure are coming home to roost and it all pivots around blind faith in flawed ideology.

Just like hypocrite politicians earning +15% super currently claiming we should not to lift super contributors from 9% because they want wage lifts...

No evidence supports this except the same flawed and outdated group think that has been wrong about everything from penalty rate cuts increasing wages, to greed is good and house prices never fall.

All those complicit should neck themselves.

I have written an article about the discriminative nature of these types of legislation
https://www.linkedin.com/pulse/discrimination-worst-kind-melinda-houghton/

Add new comment