Super unwanted surprise for returning Kiwi
When New Zealander Gen Hallot returned to New Zealand after many years working in Australia, she decided to leave her superannuation account behind.
It was not until she checked it again five years later that she realised she had lost more than A$5000 (NZ$5487) to life insurance fees – and she was paying A$109 a month for a policy she had not requested and did not need.
She checked her other superannuation account and found a similar thing had happened to the savings she had accrued from a waitressing job.
Her case is being held up as a reminder to other New Zealanders who’ve left their savings across the Tasman that just forgetting about their accounts is not a good option.
In many Australian schemes, members are put into group insurance policies, unless they explicitly opt out.
The Australian Productivity Commission report shows average premiums for default insurance are about A$300 a year but can be as high as A$2000. The report also estimates total system-wide premiums collected from unintended duplicate insurance policies at around A$1.9 billion per year.
Jessica Ellerm, chief executive at Zuper superannuation in Australia, said insurance premiums would have more of an impact on New Zealanders’ super accounts, because many worked in the country for a short time and only amassed a small amount.
Ellerm said that if returning Kiwis were no longer contributing to their Australian schemes, that insurance cost would then erode their balances quickly.