09 Nov 12 Stronger Super Regulations; Insurance and MySuper - exposure draft
The Commonwealth Treasury has released an exposure draft of proposed regulations to give effect to changes arising from legislation implementing MySuper and governance reforms.
The proposed regulations will amend the Corporations Regulations 2001, the Superannuation Guarantee (Administration) Regulations 1993, and the Superannuation Industry (Supervision) Regulations 1994 (SIS Regulations).
The proposed regulations:
- require trustees to provide a significant event notice to a member of a MySuper product, where the trustee, or an associate of the trustee, suggests or recommends to the member that the member transfer his or her interest in the MySuper product to any other product
- amend the conditions for insurance in respect of death that superannuation funds must meet in order for contributions to those funds to satisfy choice of fund requirements
- allow the existing definition of permanent incapacity in the SIS Regulations to apply for the purposes of the SIS Act
- prohibit trustees from providing insured benefits for members unless they are backed by an insurance policy from an insurer
- prohibit trustees from providing externally insured benefits (other than those that satisfy the conditions of release in the SIS Regulations for death, terminal medical condition, permanent incapacity and temporary incapacity), to beneficiaries who join the fund from 1 July 2013
- exempt the transfer of accrued default amounts to a MySuper product in another fund from the successor fund transfer rules
- require trustees to provide a notice to a member when they are attributing the member’s accrued default amount to a MySuper product or moving it to another fund, and
- allow life and total and permanent disability (TPD) insurance to be offered on a compulsory basis for MySuper members if the trustee is reasonably satisfied the insurance cannot be provided on an opt-out basis at reasonable cost.
The closing date for submissions is Wednesday, 21 November 2012.