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Higher premiums under NGS Super’s new insurance deal
NGS Super has announced the launch of a new insurance product that provides insurance appropriate to different life stages.
Starting 1 July, and provided by the fund's current insurer CommInsure, the insurance product will mean higher premiums and lower total and permanent disability (TDP) coverage for members.
"If we'd not changed our insurance, our premium increase would've been a minimum of 30 per cent. It could've been more, and it could've been more at different ages," NGS Super's general manager Laura Wright said.
She said the insurance is tailored to different age groups and the fund is moving income protection from a two-year to a five-year benefit.
Taking a "glide path model", the fund said members can tailor their cover by dialling up or dialling down cover, or apply for additional cover.
At present, a 40-year-old would receive a default TDP lump sum payment of just over $238,000. Under the new arrangement they would receive $140,000, with the option of increasing it to $252,000 within four months of joining the fund.
Their premiums will jump from $2.16 per week to $6.85 per week.
A 50-year-old used to receive $88,000 for death and permanent disability. Under the new deal, their death cover would increase to $390,000 and the permanent disability cover would increase to $110,000.
Product manager of the fund John Pedersen said there would be a shift in premium levels as funds move towards a user-based model.
"Previously, there has been a certain level of cross subsidies, which now under the MySuper regime is not really a supported approach," he said.
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