K63 Insurance and Superannuation Funds

Floods to lift reinsurance costs: Youi

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Original article by Liam Walsh
The Australian Financial Review – Page: 17 : 29-Mar-21

The Insurance Council of Australia notes that more than 25,600 insurance claims arising from the recent floods in New South Wales and Queensland have been lodged to date. Youi CEO Hugo Schreuder says the insurer has already received about 1,000 claims, and he warns that the floods may result in higher reinsurance costs. This could in turn increase the insurance premiums of customers. Meanwhile, the ICA is concerned that so-called ‘disaster chasers’ could increase the final cost of the floods, by encouraging policyholders to make claims that were not directly linked to the floods.

CORPORATES
INSURANCE COUNCIL OF AUSTRALIA LIMITED, YOUI PTY LTD

Smaller funds hit in super grab

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Original article by Lachlan Moffet Gray
The Australian – Page: 13 & 17 : 9-Feb-21

Data from the Australian Prudential Regulatory Authority shows that a total of $36.4bn was withdrawn from superannuation funds via the federal government’s early access scheme. This was well below the Treasury’s initial forecast of more than $42bn. Members of Australian­Super withdrew more than $5bn in total, although this accounts for just 2.5 per cent of the industry giant’s assets. In contrast, some $21.18m was withdrawn from the Grosvenor Pirie Master Superannuation Fund, which equates to 14 per cent of its asset base.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY,AUSTRALIA. DEPT OF THE TREASURY,AUSTRALIANSUPER PTY LTD,GROSVENOR PIRIE MASTER SUPERANNUATION FUND

Under-insurance risk in super: Cbus

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Original article by Glenda Korporaal
The Australian – Page: 13 & 14 : 25-Jan-21

Cbus CEO executive Justin Arter has called for the government to exempt workers in high-risk jobs from the ‘stapling’ provisions of its proposed superannuation legislation. Under the legislation, a person’s superannuation fund would be the first fund that they signed up for. Arter notes that many of its members work in dangerous roles, but that 80 per cent are not first-time workers and would have super funds from their previous occupations; he is worried they risk being under-insured under the government’s proposals. He says Cbus offers superior insurance for people killed or injured while working, with Cbus insurance paying out $298 million in claims in 2019-20.

CORPORATES
CONSTRUCTION AND BUILDING UNIONS’ SUPERANNUATION FUND

Top-placed super funds defy virus chaos

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Original article by Cliona O’Dowd
The Australian – Page: 22 : 22-Jan-21

Suncorp’s Multi-Manager Growth Fund was Australia’s best-performed superannuation fund in 2020, according to research house SuperRatings, returning 9.6 per cent. It was followed by Australian Ethical’s balanced option, which returned eight per cent, and Vision SS’s balanced option, which returned 6.2 per cent. The median return for super funds in 2020 was 3.3 per cent, while the S&P/ASX 200 index fell by 1.45 per cent over the same period.

CORPORATES
SUNCORP GROUP LIMITED – ASX SUN, SUPERRATINGS PTY LTD, AUSTRALIAN ETHICAL SUPERANNUATION PTY LTD, VISION SUPER PTY LTD

Proposed super changes anti industry funds

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Original article by Glenda Korporaal
The Australian – Page: Online : 5-Jan-21

ACTU assistant secretary Scott Connolly claims the federal government’s Your Future, Your Super legislation will disadvantage the $750 billion industry superannuation fund sector. Connolly notes proposed investment performance comparisons for "low-budget" MySuper accounts only include investment returns and exclude administration fees. He says industry funds typically charger lower administration fees, and Connolly claims the federal government is favouring for-profit super funds under the legislation. The proposed investment performance comparisons in the legislation currently only apply to the low budget MySuper sector, which industry super funds currently dominate.

CORPORATES
ACTU

AusSuper goes solo in $5bn Infratil bid

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Original article by Cliona O’Dowd
The Australian – Page: 13 & 19 : 9-Dec-20

AustralianSuper is offering $NZ7.43 ($7.04) per share in an indicative, non-binding takeover offer for New Zealand-based Infratil. The offer comprises a cash component of $NZ5.79 per share and an in-specie distribution of shares in renewable energy provider Trustpower. The bid for the dual-listed Infratil is the first major deal that AustralianSuper has pursued on its own; the industry fund has previously teamed up with co-investors to bid for companies such as Navitas and Healthscope. AustralianSuper is said to have been looking at Infratil for at least a year.

CORPORATES
AUSTRALIANSUPER PTY LTD, INFRATIL LIMITED – ASX IFT, NAVITAS LIMITED, HEALTHSCOPE LIMITED

Super fund satisfaction increases in October

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Original article by Roy Morgan
Market Research Update – Page: Online : 9-Dec-20

New data from Roy Morgan’s Superannuation Satisfaction Report shows an overall super fund satisfaction rating of 61.0% in October. This is an increase of 0.6% points from a month ago, but still down 3.1% points on a year ago. The most recent ratings cover the period since May 2020, during which time Australians in financial hardship were able to apply to withdraw two tranches of up to $10,000 of their superannuation. Importantly, the monthly increase in Superannuation Satisfaction is the first month-on-month increase since the COVID-19 pandemic and appears to represent a turning of the corner for the rating after declining during the worst months of the pandemic. The largest increase by sector was for Self-Managed Funds, which increased 1.5% points to a customer satisfaction rating of 65.3%. Public Sector Funds increased their customer satisfaction by 1.3% points to 71.5% and for the fifth month in a row have clearly the highest rating. The customer satisfaction rating of Industry Funds rose by 0.4% points to 62.5% in October, and Retail Funds were up 0.1% to 53.6%. The report’s findings are from Roy Morgan Single Source, Australia’s most trusted consumer survey, compiled by in-depth interviews with over 50,000 Australians each year.

CORPORATES
ROY MORGAN LIMITED

Super withdrawals hit $32bn as rush slows

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Original article by Lachlan Moffet Gray
The Australian – Page: 15 : 8-Sep-20

Data from the Australian Prudential Regulatory Authority shows that $32.6bn has now been withdrawn from superannuation funds via the federal government’s early access scheme. However, there is evidence to suggest that the rate of withdrawals is slowing, with just $380m paid out to fund members in the week to 30 August. This is the lowest weekly total since the scheme began. Meanwhile, Brendan Coates of the Grattan Institute says the scheme’s impact on retirement income has been overstated, although ACTU president Michele O’Neil disagrees with this view.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, GRATTAN INSTITUTE, ACTU

Cbus silent on coal in new carbon reduction policy

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Original article by James Fernyhough
The Australian Financial Review – Page: 18 : 1-Sep-20

Industry superannuation fund Cbus is seeking to reduce the carbon footprint of its investments by 45 per cent by 2030, while aiming for a net zero emissions investment portfolio by 2050. Fellow industry funds HESTA and First State have been explicit about their intention to divest thermal coal assets, but Cbus has declined to follow their example. Cbus has links to the Construction, Forestry, Maritime, Mining & Energy Union, which has members working in the coal industry. Cbus’s chief investment officer Kristian Fok says its decision not to specifically divest coal assets was in part based on insight gained from members working in the coal sector.

CORPORATES
CONSTRUCTION AND BUILDING UNIONS’ SUPERANNUATION FUND, HEALTH EMPLOYEES’ SUPERANNUATION TRUST AUSTRALIA LIMITED, FIRST STATE, CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION OF AUSTRALIA

Pandemic pressure for super mergers

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Original article by Cliona O’Dowd
The Australian – Page: 13 & 17 : 27-Jul-20

The balanced options of Equipsuper and Catholic Super achieved positive returns in 2019-20, despite the impact of the coronavirus pandemic. The two funds merged in 2019, and boast a combined $26bn worth of funds under management. Scott Cameron, the CEO of the Equipsuper -Catholic Super, says his target is still to have $50bn of funds under management within five years. He has flagged another merger deal within months, and expects COVID-19 to lead to further consolidation in the super sector.

CORPORATES
EQUIPSUPER PTY LTD, CATHOLIC SUPER