Moneysmart
(ASIC)

More than 70% of Australians that have life insurance hold it through super. Most super funds offer life, total and permanent disability (TPD) and income protection insurance for their members.

When reviewing your insurance, check if you're covered through your super fund. Compare it with what's available outside super to find the right policy for you.

Types of life insurance in super

Super funds typically offer three types of life insurance for their members:

• life cover - also called death cover. This pays a lump sum or income stream to your beneficiaries when you die or if you have a terminal illness.
• TPD insurance - pays you a benefit if you become seriously disabled and are unlikely to work again.
• income protection insurance - also called salary continuance cover. This pays you a regular income for a specified period (this could be for 2 years, 5 years or up to a certain age) if you can't work due to temporary disability or illness.

Most super funds will automatically provide you with life cover and TPD insurance. Some will also automatically provide income protection insurance. This insurance is for a specified amount and is generally available without medical checks.

Cancellation of insurance on inactive and low balance super accounts

Under the law, super funds will cancel insurance on inactive super accounts that haven't received contributions for at least 16 months. In addition, super funds may have their own rules that require the cancellation of insurance on super accounts where balances are too low.

Your super fund will contact you if your insurance is about to end.

If you want to keep your insurance, you'll need to tell your super fund or contribute to that super account.

You may want to keep your insurance if you:

• don't have insurance through another super fund or insurer
• have a particular need for it, for example, you have children or dependants, or work in a high-risk job

Insurance for people under 25

Insurance will not be provided if you're a new super fund member aged under 25 unless you:

• write to your fund to request insurance through your super
• work in a dangerous job you can cancel this cover if you don't want it.

Use our Life insurance calculator

Work out if you need life insurance through your super and how much cover you might need.

Superannuation and insurance can be complex. If you need help call your super fund or speak to a financial adviser.

Pros and cons of life insurance through super

Pros

• Cheaper premiums - Premiums are often cheaper as the super fund buys insurance policies in bulk.
• Easy to pay-  insurance premiums are automatically deducted from your super balance.
• Fewer health checks - Most super funds will accept you for a default level of cover without health checks. This can be useful if you work in a high-risk job or have health conditions that can make it difficult to get insurance outside super. Check the product disclosure statement (PDS) to see the exclusions and treatment of pre-existing conditions.
• Increased cover - You can usually increase the amount of cover you have above the default level. But you'll generally have to answer questions about your medical history and do a medical check.
• Tax-effective payments - Your employer's super contributions and salary sacrifice contributions are taxed at 15%. This is lower than the marginal tax rate for most people. This can make paying for insurance through super tax-effective.

Cons

• Ends at age 65 or 70 - TPD insurance cover in super usually ends at age 65. Life cover usually ends at age 70. Outside of super, cover generally continues as long as you pay the premiums.
• Limited cover - The amount of cover you can get in super is often lower than the cover you can get outside super. Default insurance through super isn't specific to your circumstance and some eligibility requirements may apply.
• Cover can end - If you change super funds, your contributions stop or your super account becomes inactive, your cover may end. You could end up with no insurance.
• Reduces your super balance - Insurance premiums are deducted from your super balance. This reduces your savings for retirement.

Check your insurance before changing super funds. If you have a pre-existing medical condition or are over age 60, you may not be able to get the cover you want.

How to check your insurance through super

To find out what insurance you have in your super you can:

• call your super fund
• access your super acount online
• check your super fund's annual statement and the PDS

You'll be able to see:

• what type of insurance you have
• how much cover you have
• how much you're paying in premiums for the cover

Your super fund's website will have a PDS that explains who the insurer is, details of the cover available and conditions to make a claim.

If you have more than one super account, you may be paying premiums on multiple insurance policies. This will reduce your retirement savings and you may not be able to claim on multiple policies. Consider whether you need more than one policy or whether you can get enough insurance through one super fund.

Before buying, renewing or switching insurance, check if the policy will cover you for claims associated with COVID-19.

When reviewing your insurance in super, see if there are any exclusions or if you're paying a loading on your premiums. A loading is a percentage increase on the standard premium, charged to higher risk people. For example, if you have a high-risk job, a pre-existing medical condition or you're classified as a smoker.

If your super fund has incorrectly classified you, contact them to let them know. You could be paying more for your insurance than you need to.

Making a claim on insurance in super

To make a claim for insurance through your super fund, see making a life insurance claim for more information.

Colin Brinsden, AAP Economics and Business Correspondent, and Steven Deare
(Australian Associated Press)

Future Fund chair Peter Costello has questioned whether government officials realise keeping interest rates low has helped stock markets to levels that may be unsustainable.

Mr Costello was speaking on Wednesday about the Future Fund rising 4.9 per cent during the December quarter. The result is a recovery from the carnage on financial markets during the early stages of the coronavirus pandemic.

That compares with the initial capital injection of $60.5 billion from the then Howard government.

Mr Costello cited fiscal and monetary policy helping, including the record low cash rate of 0.1 per cent.

"We are living through a period of extraordinary stimulation," he said.

Low rates have helped markets in many countries, including Australia and the US, rebound to record or near-record highs.

Yet Mr Costello was wary of dangers.

"The fact is money is very cheap. If you can borrow at one per cent, the easiest thing to do is go to a stock market and look for two or three per cent.

I don't know if governments realise this but by keeping interest rates low they are pumping stock markets.

Stock markets in the US, more so than here, have been pumped.

You're getting unbelievable valuations on companies that don't make profits.

You've got to ask yourself, is that sustainable in the long term."

Chief executive Raphael Arndt also cast doubt on markets' current levels.

"To believe market pricing, you would have to believe that monetary policy stays easy for that whole period," he said.

He said his team did not feel it was prudent to take more risk.

Mr Costello said the quarterly result comes after an unprecedented year where markets fell by more than a third during the early months of the pandemic.

"In the second half, markets staged a strong comeback," Mr Costello, the former Howard government treasurer, said.

"The Future Fund navigated the early market falls well, mitigating their impact on the portfolio, and performed strongly in the second half of the calendar year."

However, he said the extent to which the public health outlook improves, the duration of lockdowns, the recovery in the economy, and the pathway to reducing support measures will impact the outlook for markets.

"Investors must also remain conscious of the potential for economic, market and geopolitical shocks, particularly given that the ability for policy makers to respond with further measures is limited," Mr Costello said.

While the one-year return on the fund of 1.7 per cent was below the target of 4.4 per cent, the 10-year return of nine per cent compared with the target of 6.2 per cent.

(ATO)
www.ato.gov.au

The JobMaker Hiring Credit could mean that your business will receive payments for new positions you create.

Eligible employers will receive payments of up to:

• $200 a week for each eligible employee aged 16 to 29 years old
• $100 a week for each eligible employee aged 30 to 35 years old.

To be eligible, your business must meet criteria including:

• holding an Australian Business Number (ABN)
• being registered for pay as you go (PAYG) withholding
• reporting through Single Touch Payroll
• being up to date with income tax and GST lodgment obligations
• not falling into any of the exclusion categories.

The new positions must increase both your employee headcount and payroll.

• The total employee headcount must increase by a minimum of one additional employee from the date of 30 September 2020.
• The payroll for the reporting period must increase compared to the three months to 6 October 2020.

There are specific dates relevant to both eligibility and payment. Check our website for more details.

You can register for the JobMaker Hiring Credit using ATO online services or the Business portal at any time until the program closes. Your registered tax or BAS agent can help you with your application.

Next step:

• Register for JobMaker Hiring Credit

Find out about:

• Eligible employers
• Your eligible employees
• JobMaker Hiring Credit
• JobMaker Hiring Credit guide

Marty Silk
(Australian Associated Press)

Scammers are set to take advantage of Australian fears of coronavirus and public efforts to contain the disease in the coming year.

Australia and New Zealand's national identity and cyber support service ID Care warns COVID-19 and deepfakes will be used in scams in 2021.

ID Care analysts say cybercriminals will likely target the COVID-19 vaccine rollout in the first half of the year.

Pharamceutical giants Pfizer and Moderna are already working with America's Homeland Security department to prepare for vaccine scams.

ID Care expects scammers to pose as health officials or government agencies to harvest personal data and use vaccine conspiracy theories in phishing scams.

"This is likely to lead to an increase in phishing scams, with the intent of scaring people into clicking on harmful links," the service said in a report.

ID Care said the solution is not to open links in emails or reply to texts you don't recognise and be careful about cold-callers asking for personal information.

Cybercriminals could also take advantage of public efforts to contain the virus through check-ins with QR codes.

Scanning the codes at restaurants and venues has become common practice, but ID Care warns there are few legal rules for the technology or use of personal user data in Australia.

"And when you think of the information stored on there your name, address and phone number this information could be a honeypot for cyber criminals," the service said.

"Then there is the additional risk those scammers are plotting new measures to implant malicious QR codes in businesses which will harvest the data entered."

Unfortunately, there is little users can do to protect themselves and there are few warning signs for people who have been targeted.

ID Care said Australians will also need to be vigilant about deepfakes endorsing products or services in 2021.

Deepfakes are realistic videos or audio recordings of politicians or celebrities that are actually computer generated.

They have been used to sow confusion in the US and ID Care believes they could be used to trick Australians.

The service warned deepfakes will get even more convincing in 2021, so people should always get professional advice before acting upon online videos of famous people.

"And don't believe every video clip you see of a famous person, whether it be a celebrity endorsing cryptocurrency or a President giving a "speech" via YouTube," ID care said.

Meanwhile, established scams such as ransomware have morphed into more sophisticated and elaborate operations.

Before this year ransomware attacks involved cybercriminals infiltrating networks of businesses, encrypting data and offering a decryption key for a sum of several hundred dollars.

However, during 2020 scammers started targeting multinational firms, and rather than locking up data they threatened to publicly release it via the dark web.

ID Care said it was a double extortion technique forcing businesses to negotiate or suffer the cost of data leaks and reputation damage.

The service said many Australian firms have already been affected by this new style of ransomware attack and that will continue in 2021.

"It's the combination of making a big financial reward and relating low risk that has led to ransomware becoming a booming and viable business model for cybercriminals," ID Care wrote.

It advised firms to train their staff in cybersecurity so they avoid downloading malicious links from phishing emails.

Colin Brinsden, AAP Economics and Business Correspondent
(Australian Associated Press)

The federal government is being urged to place stricter controls on stimulus programs as the economy recovers faster than expected from the coronavirus recession.

The economy expanded at its strongest rate in more than 40 years during the September quarter and data suggests the strong rebound should continue into 2021.

Commercial credit bureau CreditorWatch has found debtors are taking an average of 33 days to pay bills, compared with a peak of 47 days in June and during the depths of recession.

"The recovery in payments data is a clear indication the economy is on the way back, supported by better-than-expected GDP numbers for the September quarter," CreditorWatch chief executive Patrick Coghlan said.

"There's potential for the federal government to consider introducing further means tests for economic stimulus programs such as JobKeeper, to reduce pressure on the public purse and allow economic conditions to normalise."

The JobKeeper wage subsidy is not due to end until March next year.

Mr Coghlan also believes the temporary moratorium on trading while insolvent should end at the end of this month.

"Extending this provision risks causing damage to the economy as solvent firms could be extending credit to insolvent firms, potentially creating a domino effect down the track if insolvent firms are allowed to continue to operate," he said.

More than 3000 Australian companies have avoided going into external administration since April, compared to figures from 2019.

Meanwhile, the release of the monthly consumer sentiment survey will add to a spread of confidence gauges pointing to Australia accelerating out of the pandemic.

In November, sentiment soared to a seven-year high, an encouraging sign for retailers during their peak Christmas period.

The consumer confidence index also rose by a further 1.7 per cent in the past week to its highest level for 2020.

It was the second consecutive week confidence rose and means it has increased 13 times in the past 14 weeks.

The monthly National Australia Bank's business survey also showed confidence rising for a fourth straight month in November and to its highest level in two-and-a-half years.

Business and consumer measures provide crucial pointers for future household spending, investment and employment.