I am medically vulnerable and very concerned about catching COVID-19. I don't have any savings apart from my small industry fund super balance ($6,000). My job is uncertain, and my income has dropped by over 50% in the last few months because of the virus. I am worried about whether my insurance in my super fund will cover me if I lose my job. I am also worried I may not be able to claim on my insurance if I get sick from COVID-19 because I heard that insurance policies do not cover pandemics. What should I be doing to make sure I am covered?
Louise in Dapto, NSW
Top answer provided by:
Ralph Morgan
Dear Louise, thanks for your question. I am certain many employees will be thinking about the potential impacts of Covid-19 on their financial security and well-being at this time.
Insurance available within superannuation is generally Life and/or TPD (Total and Permanent Disability) Insurance, and TPD insurance provided within superannuation is generally the more restrictive 'any job' rather than 'own job' cover. Therefore your insurance within superannuation would probably not cover you if you lose your job, but would provide a benefit in the event of death or total and permanent disability. You should check the exact details of your insurance cover in the PDS of your particular policy. Australia Life insurance policies don't have a pandemic exclusion and, generally, will still pay out for coronavirus-related claims unless you travel overseas and die while you're there.
As you have been adversely financially affected by COVID-19, you may be able to access some of your superannuation early. Eligible citizens and permanent residents of Australia or New Zealand can apply to access up to $10,000 of their super in the 2020–21 financial year. It would be important to seek qualified financial advice regarding the potential long term impacts of early withdrawal of superannuation on your retirement savings, and on the continuation of your insurance cover (your insurance will be not cancelled automatically due to low super balance as your super balance has exceeded $6,000, but there would need to remain a sufficient balance to cover insurance premiums).
In NSW up to 20 days paid special leave will be provided where someone is required to isolate and/or are unable to work because they are:
* Caring for sick family members where they are unwell due to COVID-19;
* caring for family members due to closure of schools and caring facilities (special leave does not apply for usual school closures such as school vacation dates); or
* unable to attend work due to transport disruptions.
After the 20 days of special leave has been used, employees may access accrued leave entitlements, including sick, annual, family and community services leave, extended/long service leave. Check your current accumulated leave entitlements with your HR department.
Casual employees may be entitled to up to 20 days special leave if they are absent from the workplace as result of COVID- 19. This is the same entitlement as ongoing staff. All payments will be issued pro rata and at the base rate of pay, that is, it will be paid at the Monday to Friday day shift rate.
You should enquire with your HR department if your employer is receiving JobKeeper payments (an employer is eligible of JobKeeper payments of if the business has turnover of less than $1 billion which has reduced by more than 30%, or turnover of more than $1 billion which has reduced by more than 50%.), as this may provide additional income if your normal income has been reduced by 50%. The amount of JobKeeper payment depends on hours of employment (more or less than 20 hours per week), and the period:
For eligible employees working less than 20 hours per week (on average - the assessment of hours is generally based on the four weeks prior to 1 March 2020):
* Currently $1,500 (gross) per fortnight until 27 September 2020
* From 28 September 2020 until 3 January 2021 will reduce to $750 per fortnight
* From 4 January 2021 until 28 March 2021 will reduce to $650 per fortnight
For eligible employees working more than 20 hours per week (on average):
* Currently $1,500 (gross) per fortnight until 27 September 2020
* From 28 September 2020 until 3 January 2021 will reduce to $1,200 per fortnight
* From 4 January 2021 until 28 March 2021 will reduce to $1,000 per fortnight
I hope this general information may be of assistance.
Warm Regards,
Ralph
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