What's the go with superannuation companies sneaking life insurance policies into their superannuation products?
I recently did some work with a temp agency, and yesterday, I received a letter from Colonial First State informing me that I have a Death insurance and Total and Permanent Disability insurance policy. No one at the temp agency offered to sell me either insurance policy. I was only offered, and I only wanted, superannuation.
This has happened before with 2 other superannuation companies. I only realised when they sent out my annual account showing - in small print that money had been siphoned off into unrequested insurance policies. When I queried those companies, they said it's in the PDS. Of course, when you begin a job, you are swamped with paperwork, and you are supposed to search through it all to make sure no one has snuck in a death insurance policy or a voucher for a set of steak knives or whatever else they think they can get away with.
When I queried it with the companies, they gave all kinds of obfuscations like, "It is embedded in the deed of trust lodged with XYZ" and "The government approved this deed of trust." So they make it all look totally official and honourable.
So I took it to the organisation that arbitrates such issues, and they said its in the PDS, and I signed a form saying I read the PDS. Case closed. I went searching through one of the PDSs. It's buried in like page 25 of a 75 page document. And they call it an "option", yet they give it to you by default. The "option" is to cancel it to reduce your losses if you are lucky enough to notice it.
The government forces us to take superannuation, then they and teams of superannuation company lawyers protect superannuation companies when they siphon off your superannuation into life insurance policies that have nothing to do with superannuation and that you never requested or wanted.
