LIFE INSURANCE This booklet applies to a Member of SuperLife who wants to take out lump sum insurance for death, or death and total & permanent disablement, or to extend the insurance benefit provided by their employer. JUNE 2015
Who provides the insurance? The insurance benefit is fully insured by SuperLife with a life insurance company. The current insurer is Fidelity Life. What if I have insurance elsewhere? If you have life insurance elsewhere, you may not need any more insurance. However, you should look at the cost of any existing private insurance. If SuperLife s rates are cheaper, you might think about replacing the insurance you already have. Alternatively, SuperLife s insurance may be more flexible and better suited to your needs. Are there restrictions on the insurance amount? No. You decide how much cover you want. You can make separate decisions for you and for your spouse/partner. You can also decide whether it is for death only, or death and total & permanent disablement. The only rules are that: You can t have more TPD cover than death cover. If the TPD benefit is paid (and it is the same level as your death benefit) your cover ceases. If your TPD cover level is less, the excess death cover can continue if you wish and continue to pay the premiums. What does TPD mean? Generally, there are two conditions that must be met to qualify for the TPD benefit: You must have been absent from work for six consecutive months as a result of your disability, and The insurer must decide, based on medical and other evidence, that your disability makes it unlikely that you will ever again engage in any gainful employment for which you are reasonably qualified by education, training or experience. Advantages through SuperLife Subject to the medical requirements, you can tailor your cover to meet your changing needs. Premiums are paid by payroll deduction under the rules set by your employer, or from your bank account or from your savings accounts as applicable. The Trustee has an overseeing role to ensure that the medical insurance is competitive and the insurer performs. If the insurance is through your employer s arrangements, you can normally continue your insurance when you leave your employer. The legal stuff This is not an investment statement for the purpose of the Securities Act 1978. An investment statement is available from SuperLife free of charge. 01
Do I have to provide medical evidence? Yes and no. If you are an employee of an employer that participates in SuperLife and you take out life insurance cover when first eligible, you can take out or increase your other insurance cover under SuperLife up to the medical-free cover level (see later) without medical evidence. This is subject to your answers to the health questions on the application form. First eligible means within two months of first joining an employer who makes SuperLife available to its employees. If you take out voluntary insurance so that your total SuperLife insurance is more than the medical-free cover, or if you take it out after you are first eligible, or you are not an employee of an employer that participates in SuperLife, you will have to provide medical evidence. Initially, you will be asked to complete a personal health statement for the insurer. Depending on the answers to the questions, the cover level and when you apply, you may then be asked to supply further medical evidence. You will be contacted in these cases. If you are required to have a medical examination, the insurer meets the doctor s cost. What are the medical-free cover levels? The current medical-free cover levels depend on the type of member you are: Employee Members $400,000 Spouse/partner Members $250,000 Medical-free cover level You can have higher cover, with appropriate medical evidence. How much does the cover cost? If you take out voluntary cover, you pay the cost of the premium and any administration fee - it is deducted from your pay or your bank account as appropriate. The premium for the insurance cover depends on your age, sex, current health, whether you smoke and the amount of cover you want. The SuperLife insurance booklet includes the current annual premiums for each $1,000 of cover. These assume that you are in good health. The insurer will decide whether the standard premium needs to be changed for you at the time of your application, based on your answers to the health questions and any other medical evidence received. Once the insurer has reviewed your application, you will be advised of the premium for the first year. You may cancel your application at that time, if you then decide you don t want the cover. In addition to the base insurance premium, there is an administration fee of $33 a year. No one at SuperLife receives a commission from your SuperLife insurance. 02
How are the premiums paid? If payable by payroll deduction, the premiums are payable weekly, fortnightly or monthly, depending on how often you are paid. They are deducted directly from your pay by your employer and paid to SuperLife. In some cases, they will be paid by direct debit from your bank account, or you will be able to pay them from your SuperLife savings account, depending on the rules with your employer. Where payment by deduction from the employer is not available, payment may be made by bank direct debit. Will the premium change? Yes, the premium is based on age and will change as you get older. The premium will also change if the insurer revises its premium rates. SuperLife s premium review date is each 1 April. You will be advised as at each 1 April what the premium for your insurance will be for the next year. Part of the Trustee s job is to make sure the insurer stays as competitive as possible. The Trustee will negotiate the best terms possible. However, in the end, you must decide what level of benefits you want for what you are prepared to pay. There are also options to pay a higher premium but have it fixed for 5 or 10 years. When will the cover start? The premiums and cover start when confirmed by SuperLife. However, the insurer has agreed to cover you for accidental death for the amount you choose for up to three months from the date SuperLife receives your application form. The only exception to this will be if the insurer would have refused cover because of the answers you give in the application form (for example, if you have a terminal condition). Can I increase my cover? Yes. You can increase your insurance cover under SuperLife, without giving any medical evidence: by up to 30% each year, as long as the increased total insurance cover under SuperLife is less than the medical free cover level, or if the extra insurance is taken out within one month after your marriage, or after the birth of a child, and the increased total insurance cover under SuperLife is not more than the medical free cover level. You can increase your insurance in all other circumstances with appropriate medical evidence. 03
Can I stop my cover? Yes. You can stop your voluntary life insurance at any time by advising SuperLife. Can I continue my cover if I leave my employer? Yes. If you leave your employer, you can continue some or all of your SuperLife cover. You will need to arrange for the premium and administration fee to be paid from your bank account by direct debit. SuperLife will give you details at the time that you leave. Is the insurance taxable? No. Under present law, there is no duty or tax payable on the benefit paid. Who receives the insurance benefit? If you die, under SuperLife s Trust Deed, the Trustee pays your insurance to your nominees (your dependants, family trust or your personal legal representative), in accordance with your wishes. You can advise the Trustee of your wishes or change your wishes regarding the payment of your death benefit by completing a beneficiary form (at any time). A beneficiary form also needs to be filled out by your spouse/partner, if you have taken out spouse/partner cover. If a beneficiary is a minor, then the benefit due to that minor will be held in trust, or paid to a trust for the benefit of the beneficiary. If you become entitled to the TPD benefit, the Trustee pays you the insurance. If you are unable to look after your affairs, the Trustee can pay the amount to a trust for your benefit. More information regarding the payment of death and TPD benefits can be found in SuperLife s investment statement and on the beneficiary form. How do I apply? You can apply at any time for voluntary life insurance for you or your spouse/partner. To apply, you need to read the SuperLife investment statement, complete the Life and/or disability insurance application form and return the form to SuperLife. Separate application forms apply for you and for your spouse/partner. 04
Important note The insurance cover is provided through SuperLife. SuperLife is a registered superannuation scheme. SuperLife fully insures the benefit you choose with a life insurer. It is important for you to answer the questions on the application form, and the personal statement, fully and truthfully and to give any extra information that the insurer wants. For example, if you have smoked in the last 12 months, you must say so. If you die and the insurer does not give the money to SuperLife because of information you gave (or did not give), or for any other reason, SuperLife will not have the money to pay out the benefit. In that case, your family will not get the money you thought it would. superlife@superlife.co.nz 0800 27 87 37 41 Charlotte Street, Eden Terrace, Auckland 1021 PO Box 8811, Symonds Street, Auckland 1150