Changes to fees, investments, and insurance for your Accumulation Plan account
April 30 2024
Significant event notice
ESSSuper acts in our members' best interests and is committed to optimising our members' superannuation outcomes.
Effective 1 July 2023, we are making some important changes to your ESSSuper Accumulation Plan account(s) regarding:
- Ongoing administration fee reduction
- Administration fee rebate to members with an open Accumulation Plan account at 31 May 2023
- Investment option name and classification changes
- Insurance policy improvements.
1. Ongoing administration fee reduction
Our new administration systems are more efficient, so we are reducing administration fees on Accumulation Plan accounts. This is in line with our 'profit-to-member' ethos and will help to increase members' retirement benefits.
Administration fees and costs are made up of an account-keeping fee and an administration fee. From 1 July 2023, the account-keeping fee will remain as $52 per annum but the administration fee will reduce from 0.25% to 0.20% per annum.
Additionally, the administration fee cap will reduce from $2,120 to $750 per annum.
| Fee type |
Before 1 July 2023 (per annum) |
From 1 July 2023 (per annum) |
| Account-keeping fee |
$52 |
$52 |
| Administration fee |
0.25% |
0.20% |
| Cap on total administration fees and costs |
$2,120 |
$750 |
What this means for you
These reductions will come into effect automatically on 1 July 2023, meaning you don't need to take any action. The below are two examples for comparison.
Example 1
Sam has an Accumulation Plan account balance of $100,000.
Currently, their total administration fees and costs are $302 (i.e. a $52 account-keeping fee and a $250 administration fee).
Due to the fee reduction from 1 July 2023, Sam's total administration fees and costs will be $252 (i.e. a $52 account-keeping fee and a $200 administration fee). That's a saving of $50 per annum.
Example 2
Li has $400,000 in her Accumulation Plan account.
Currently, Li's total administration fees and costs are $1,052 (i.e. a $52 account-keeping fee and a $1,000 administration fee).
Due to the reduced cap from 1 July 2023, her total administration fees and costs will be $750 (i.e. a $52 account-keeping fee and a $698 administration fee). That's a saving of $302 per annum.
Important notes:
- The examples above have been created to demonstrate the broad impact of changes to Accumulation Plan administration fees and costs prior to and from 1 July 2023 on different account balances.
- These examples are provided for illustrative purposes only and assume that each balance has been maintained in the fund for a full year. Fees and costs have been calculated in accordance with the administration fees and costs published in the Accumulation Plan Product Disclosure Statement (PDS) issued 5 December 2022 and the new Accumulation Plan PDS to be issued on 1 July 2023. These examples do not include all fees and costs. You should review the Accumulation Plan PDS and the incorporated Fees and costs guide (AP.7) for more information about fees and costs.
- These examples are not a promise or guarantee of the savings you may receive.
2. Administration fee rebate to members with an open Accumulation Plan account at 31 May 2023
As we have gained efficiencies from our new administration system this financial year, we are able to rebate a portion of this year's administration fees for Accumulation Plan accounts.
This rebate will be calculated as the equivalent of the scheduled administration fee reduction of 0.05% of your Accumulation Plan account balance at 31 May 2023. It will be applied by adjusting the unit prices for Accumulation Plan investment options on 31 May 2023.
What this means for you
This rebate will be applied to the Accumulation Plan investment options' unit prices automatically on 31 May 2023, meaning you don't need to take any action.
3. Investment option name and classification changes
We are renaming six of our nine investment options for Accumulation Plan accounts from 1 July 2023.
Additionally, from 1 July 2023 our investment options will be put into two classifications: diversified options and single asset class options.
We are making these changes to our investment options to make them easier to understand and the terminology more compatible with that used by other super funds.
| Current investment option name |
Investment option name from 1 July 2023 |
| Diversified options |
| High Growth |
Growth |
| Basic Growth |
Balanced Growth |
| Ethically Minded |
Ethical Diversified |
| Growth |
Balanced |
| Balanced |
Conservative |
| Conservative |
Capital Stable |
| Defensive |
Defensive |
| Single asset class options |
| Shares Only |
Shares Only |
| Cash |
Cash |
What this means for you
These are changes to investment option names and classifications only. The underlying strategic asset allocations and target returns will not be impacted. They will come into effect automatically on 1 July 2023, meaning you don't need to take any action.
Investment options aren't available in ESSSuper's defined benefit super schemes, which are guaranteed by the Victorian State Government and are not impacted by investment performance.
4. Insurance policy improvements
We provide Death, Total and Permanent Disablement (TPD), and Income Protection insurance cover to members of our Accumulation Plan through AIA Australia Limited.
As our AIA policies are expiring at the end of this financial year, we have negotiated a new contract to start on 1 July 2023.
We are pleased to advise that:
- Premiums will not increase as a result of the new contract, and
- The new AIA policies include ten policy changes that may benefit you.
What this means for you
These changes will come into effect automatically on 1 July 2023, meaning you don't need to take any action. They will result in more circumstances in which genuine claims can be paid, reduced waiting periods, and increased duration of payments.
Basic information about these changes is listed below, with additional details and examples on our Additional insurance information web page.
Changes to Death, TPD and Income Protection cover:
- The two-year pre-existing condition exclusion will be replaced with 30 consecutive days of active employment at any time since the start of your cover, and
- The self-harm exclusion period will be reduced from two years to 13 months.
For Death and TPD cover:
- The TPD Activity of Daily Living (ADL) definition and TPD domestic duties definition will be replaced with the TPD Activity of Daily Work (ADW) definition or mental illness TPD definition, and
- The pandemic exclusion (which was never activated for COVID-19) will be removed.
For Income Protection cover:
- Insured members will no longer be required to work 15 or more hours per week to be eligible for Income Protection cover. However, if the insured member is working less than 15 hours per week on average in the three months before the start of the waiting period, the insured member will be assessed against the standard 'any occupation' disability definition
- The payment of Income Protection benefits will be aligned with the scheduled increase of the Superannuation Guarantee called at 12% by 1 July 2025
- The recurrent disability definition will be extended from six months to one year before the waiting period will re-apply
- Where the waiting period is 60 days or more, the return to work allowance during the waiting period will be extended from five to ten consecutive days
- While an insured member is overseas the payment of disability benefits will be increased from six months up to one year, after which the insured member may be required to return to Australia for further assessment for their benefits to continue
- A criminal activity exclusion will be introduced to prevent an insured member from claiming a disability benefit because they participated in criminal activity or whilst they are incarcerated.
You can cancel, change, or increase your insurance cover at any time by using the Vary your insurance cover (E167) form. This prepopulated form is available through the Insurance / Insurance details menu in Members Online.
Why have insurance cover?
Having adequate insurance cover may be vital to provide for you or your loved ones financially should an unforeseen event occur.
Insurance cover, subject to eligibility, through your Accumulation Plan account can be a straightforward and cost-effective way to provide this protection.
We're here to help
You can book an appointment with one of our expert Member Education Consultants for general advice about your ESSSuper account(s). If you're looking for personal advice relating to your financial situation or needs, our qualified Financial Advisers* can help. To request an appointment, please call us or use our online enquiry form.
A copy of this significant event notice will be available to download by logging into your Members Online inbox.
From 1 July 2023, the changes described in this document will be updated in the relevant Product Disclosure Statement (PDS) and associated guide(s), on our website, and in Members Online where applicable.
If you have any questions, please contact us on 1300 650 161 (Emergency Services members) or 1300 655 476 (State Super members) between 8:00am and 5:00pm Monday to Friday, or email us at info@esssuper.com.au
Warm regards
Duncan Winton
Group Executive, Strategy, Brand & Insights