Auto-consolidation of super could leave you worse off.
The government’s plan to introduce automatic consolidation of superannuation accounts could result in millions of fund members losing valuable life insurance benefits.
Among the millions of inactive funds that will be swept away over the next couple of years to make the super system more efficient, an estimated 2 million have life policies that remain in force and represent value to fund members. Once the fund is closed and the retirement savings account balance transferred to the member’s active fund, those life insurance benefits will be lost.
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