Nearly 15 million Australians have superannuation, almost the entire working-age population. The vast majority have death, total and permanent disability (TPD) and/or income protection insurance in some form. Group policies account for 70 per cent of all life insurance Australians hold.
Accordingly, super funds and their life insurance partners are well placed to have some influence on important social issues, such as suicide and obesity, and have a substantial impact on their members’ health outcomes and capacity to work.But super funds and insurers are hamstrung in their ability to offer support to members.
The Health Insurance Act 1973 prohibits life insurers (and general insurers) from paying for medical treatment that may otherwise be payable under Medicare or by a private health provider. This means group insurers cannot pay for most medical services to treat super fund members’ injuries or illnesses, or fund many medical-related rehabilitation services.
Group insurers can offer retraining services as part of income protection benefits, and some do; however, under the Superannuation Industry Supervision Act, (SIS) trustees offering TPD benefits via MySuper funds can offer only benefits consistent with the definition of ‘permanent incapacity’, which does not include a re-training clause.