Super fund call centres overwhelmed on opt-in insurance

The Federal Government has been urged to extend the timetable for the introduction of further legislation impacting insurance inside superannuation on the basis that super fund call centres have already been overwhelmed by the volume of calls relating to cover removed from supposedly inactive accounts.

Australia’s largest industry superannuation fund, AustralianSuper, told the Senate Economics Legislation Committee that despite significant efforts to inform members about the implications of the Government’s Protecting Your Super legislation systems became overwhelmed because of the short time-frames involved.

“When cover was being removed for inactive members under Protecting Your Super, AustralianSuper made a huge effort to allow members losing cover to make an informed decision,” the submission said. “We corresponded with all affected members; we sent text messages to those who did not contact us following the initial correspondence; we contributed financially to an industry-wide ASFA awareness campaign; and we significantly increased staffing at our contact centre. “

Related News:

The big industry fund said that, “despite all this, due to the short timeframe for removing cover for inactive members, the response from affected members was overwhelming and our expanded contact centre was unable to cope with the volume of calls and provide what we would consider an acceptable service to affected members”.

“Our understanding from industry colleagues is that this was a common experience,” it said.

AustralianSuper said that whilst losing cover might provide significant benefits from not eroding account balances for the majority of members, a failure to make an informed decision to continue cover for members with financial commitments and dependents may have dire financial consequences for those unfortunate enough to die or become disabled.

“As such we believe more implementation time is needed…to allow individual members time to make informed decisions,” it said.




Recommended for you

Author

Comments

Comments

Typical union fund. When it actually has to provide service to members it's a problem. They are only upset because they are losing an income stream for insurance cover their members never asked for, they could care less about their members.

For once I am in agreement with a comment from Australian Super.

I have had over 5 clients loose cover they needed because they did not understand the situation and I suppose if a client does ring there adviser for advice in regards to this ASIC will require a full analyst of the clients circumstance and a full SOa at no cost to the client.

The time frame imposed by this ridiculously thought through legislation was destined to fail and place enormous pressure on administration systems to deal with volume.
For a START, THE LEGISLATION AND ASSOCIATED EDUCATION AND INFORMATION PROGRAMME SHOULD HAVE BEEN SPREAD OVER A FULL 12 MONTH PERIOD ON A STRUCTURED AND REPETITIVE BASIS... NOT OVER A 3 MONTH PERIOD LEADING UP THE END OF A FINANCIAL YEAR WITH ALL THE INCREASED ADMINISTRATION IMPACT ASSOCIATED WITH THIS ALSO.
Many clients have said they were so overwhelmed with correspondence on multiple levels, they did not know which items required response and which didn't.
Take OnePath for example:
Form the start of this calendar year, superannuation members have received multiple correspondence regarding the Successor Fund Transfer to IOOF, The sale of OnePath's insurance arm to Zurich, several letters regarding adviser commissions with ASIC forcing OnePath to send more to encourage members to turn them off despite legislation to being enacted as yet and then multiple correspondence regarding the Protecting My Super legislation.l
This is an example of extremely poorly thought out legislation, firstly because of the unintended consequences that could indirectly financially devastate individuals and families and secondly because of the unacceptable time frame that was enforced to ensure people were making the right decisions for them.
The Govt needs to extend the time frame at least for another 3-4 months for members who did not respond and who wish to retain their insurance cover for the financial protection they require.
If cover has been cancelled due to non response, the member should be provided the opportunity to reinstate the same cover without assessment applied within a certain time frame.
By enforcing such short time frame to this legislation, the Govt is directly creating the possibility whereby the death, disability or injury or illness to a superannuation member could have significant and avoidable financial impact.
Without the insurance in place, the remaining family would most likely then turn to the Govt for financial support.
Good planning.....no.
Short sighted and not thought through...yes.
Don't care about the devastating impact of losing the insurance cover inadvertently.....most certainly.
Just yet another Govt and Legislative stuff up because those in power, just don't get it.

Add new comment