Changes to Salary Continuance Insurance (SCI)

If an employee member were to claim, their monthly benefit would be reduced by any other income they receive (including income received from other SCI or income protection cover). If they hold SCI cover in more than one FirstChoice super account they may not receive the full benefit from the additional SCI cover that they hold. 

To ensure clients get value out of their insurance and only pay for SCI cover that they can potentially claim on, we only allow them to hold SCI cover in one FirstChoice super account.

There are several reasons an employee may end up with SCI covers across multiple FirstChoice super accounts. For example, they may have held a FirstChoice Personal super account with SCI cover and when they subsequently joined your employment a new FirstChoice Employer Super  account with automatic SCI cover was opened for them.

We will notify all members of this product change in their annual statements. 

From August, we’ll notify your employees who have SCI cover in more than one FirstChoice super account with:

• a summary of all their active SCI cover 
• the opportunity to choose which SCI cover they would like to keep.  

We’ll ask them to review their insurance and decide which SCI cover they would like to keep. They’ll receive an initial notification with 60 days to provide a direction and a reminder notification 30 days after, before their additional SCI covers are cancelled. We’ll also encourage them to speak to you about their options. 

Once your employees cover is cancelled, we will send them a cancellation notification.

This notification will include:

• details of the SCI cover cancelled
• an option to reinstate the cancelled SCI cover (where we select the cover to be cancelled and cancel the other SCI cover) 
• details about the refund process

We’ll cancel your employee’s additional SCI cover in line with the direction they’re provided, or if we don't hear back from them within 60 days from the date of the  notification letter we’ll select the SCI cover that will be kept.

When no selection is made, CFS applies the same approach across all members in determining the cover that remains inforce and the cover that is cancelled. Firstly, we will keep inforce the SCI cover that was underwritten and if both are underwritten then the cover opened most recently. If neither cover was underwritten, we will keep inforce the cover that was opened most recently. All other SCI cover will be cancelled.

We’ll then refund the premiums charged on the cover we cancel for the period where they had more than one SCI cover.

For employers that pay premiums for their employee members, the refunded premium will be paid back to the employee member’s super account.

You can encourage your employees to 

• review all of the insurance cover they have across their FirstChoice super accounts, as well as any other insurance they may have, so they can work out which cover best suit their needs. 
• find information on their current insurance cover by logging into FirstNet, or by checking their super statement or annual review letter. 
• speak to a financial adviser if they would like help making a decision about which cover to keep.

Your employee may have different exclusions for each SCI cover (such as an exclusion for pre-existing health conditions) and that may influence their decision about which cover to keep. The best way to find out whether they have any exclusions is to check the insurance acceptance letter they would have received when they commenced their cover.

We have some more information about this change at cfs.com.au/insurance. This may help you guide your employees if they have any questions about their SCI cover.

They can also find more general information on income protection insurance (SCI cover) on the MoneySmart website.

Yes, we’ll refund their premiums for their cancelled cover for the period in which they had more than one SCI cover. This refund will be paid into the FirstChoice super account from which the premiums were deducted within five business days. 

The insurance premium is deducted from the employee’s super account and will be credited to the employee’s account.

We cannot refund the premium back to the employer as the amount paid must be treated as an additional employer contribution rather than the employer paying the insurance premium. Once a contribution has been made to a member’s account, it cannot be returned to the employer. 

No. Employees can't merge SCI cover. Employees can make changes to their insurance cover at any time by calling or emailing us, submitting a request via ePost on FirstNet, or writing to us at: Colonial First State, Reply Paid 27, Sydney, NSW 2001. 

No, we will only cancel one SCI cover and refund the premiums for that cover.

Your employee can then cancel the remaining cover, however the premiums will not be refunded as they would have been entitled to claim under that insurance. 

Yes. There is a 90 day reinstatement period for their cancelled SCI cover. This means if your employee lets us know within 90 days from the date their SCI cover was cancelled that they would like to keep that cancelled SCI cover instead, we can reinstate it and they won't need to reapply for SCI cover.

They will need to:

1. Download the FirstChoice Salary Continuance Insurance Reinstatement Form
2. Read the form instructions carefully and complete the relevant form fields
3. Print, sign and date the form
4. Return the form to us by following one of the options below

Upload the form online through FirstNet
Upload a scanned copy of the completed and signed form, through our secure online portal FirstNet under My Account > Upload a scanned form

Post the form to us at:
Colonial First State
Reply Paid 27
Sydney NSW 2001

If their cancelled cover is reinstated:

• We’ll deduct premiums from their super account for the period between the cancellation date and the reinstatement date so there is no gap in their cover. 
• They’ll need to make sure there’s enough money in their super account to cover this amount.
• Their cover will then continue with the same policy terms.
• We’ll have to cancel the SCI cover in their other FirstChoice super account so they don't have SCI cover in more than one FirstChoice super account.

If you have any questions call us on 1300 654 666 Monday to Friday between 8:30am and 6pm, Sydney time.