As an Employer, you play a significant role in ensuring your employees receive the right insurance benefits. There are some important changes you will need to be aware of (and requirements for information that you will need to provide to us) so that your employees receive the right level of cover for their circumstance
PSSap has introduced lifePLUS cover for PSSap members. lifePLUS cover features a more comprehensive default insurance cover via lifePLUS auto cover and the ability for PSSap Ancillary members to access tailored insurance via lifePLUS choice cover.
Setting up a PSSap account
There are changes to the way new members receive cover and how that cover is calculated. lifePLUS auto cover is provided based on base annual salary and employment status.Not providing correct details can have significant consequences for PSSap members.
Employment Status – Under our new arrangements, PSSap casual members are provided with insurance on an opt-in basis. This means that casual members must opt in to lifePLUS auto cover within 60 days of their welcome advice (and no later than 180 days after joining the employer) or they are ineligible for automatic cover.
Full and part time members are automatically provided with cover on an opt-out basis. If a member is incorrectly classified as full time or part time, they risk being unaware of the 60 day opt in requirement. If it is determined later (for example, when the member lodges a claim) that the member should have been classified as a casual employee when they first joined PSSap, they will not be able to access cover and their cover will be cancelled. This is not a good outcome for an employee at a time when they need it most.
For the purpose of insurance, a contract or non-ongoing employee on a contract of less than 3 months should be reported to PSSap as a casual employee.
Base Annual Salary – A base annual salary is required for us to calculate income protection benefits for PSSap members. It is important that the correct base annual salary is provided at commencement and updated on the contribution file each time the figure changes.
If no base salary is provided, a default salary of $47,000 will be applied to the account and premiums will be based upon this salary.
It is important that base annual salary rates are correctly reported, as claims on income protection benefits are calculated on the lesser of:
- the actual base annual salary at the time of total disability; or
- the base annual salary advised to PSSap.
Example: Murray is a new employee with a base annual salary of $100,000 p.a. ($8,333 per month). When setting up his PSSap account his employer did not provide a base annual salary, so he is only covered for a default salary of $47,000.
On becoming ill, he is expecting an income protection payment of $6,250 per month paid to his bank account (plus 15.4% paid to his PSSap account) – enough to cover his mortgage and bills with a little extra for his medical costs.
Upon submitting his claim, Murray finds he will only receive a monthly income protection benefit of $2,937.50 – less than half of what he expected.
Instead of focusing on getting well, Murray is stressed about his financial situation and wondering how he will pay his bills if he cannot return to work soon.
What can employers can do to help ensure that correct entitlements are provided to members?
- Ensure that the correct employment status is provided when setting members up on the contribution file.
- Ensure that they provide the correct base annual salary and keep it updated if there are any changes.
- 3. Set up members with full contact details, including an email address, postal address and telephone number. This means we can provide welcome advice and get in contact with members if required.
Claims - including employer initiated
Insured members of PSSap have access to a collaborative support network and comprehensive coverage. Our income protection is designed to support members while they get back on their feet.
Our commitment to rehabilitation
As part of our income protection benefit, the Insurer may cover the cost of rehabilitation programs designed to help PSSap members in their recovery. Services available include:
- Workplace assessments to identify solutions (and equipment) to support a return to work plan
- Career guidance to explore alternative work options if employees are unable to return to their role
- Holistic work readiness programs (including fitness and coaching) to ensure that members are confident and ready to return to the workforce once recovered
- Improving a members skills and capabilities so that the return to work is sustainable over the long term, and
- A specific mental illness programme called ’RESTORE’ which treats the person not the illness.
The benefits of rehabilitation - The following excerpts are from an email received by a PSSap member who has been engaged in a rehabilitation program through income protection:
I have just completed my first full week with the Team at Fit to Manage and I must say that my health is improving immensely. The program looks at stretching all the different muscle groups of my body at different stages. And believe me when I say this it is very painful, but well worth it. Slowly and with assistance and perseverance I can see significant results and would like to continue with these appointments when I return to work. In addition to this, when the Team say I am fit enough, I will be joining a Gym to continue with improvement of my overall health at my own expense.
I distinctly remember that it was not very long ago that I could hardly walk to the shops or touch my toes or perform domestic chores properly due to my ill-health. Nowadays, my fitness level has changed for the better (quite remarkably) and I am overwhelmed with the results.
Also, I have been suffering from ongoing migraine problems with my right hand side of my head and neck and I have been to see different specialists over a period of 6 years and had several MRI examinations with no significant information as to why these occur. Since starting with the Fit to Manage Program there has been a massive change and I no longer require prescription medication to manage this pain when it arises. Apparently, the stretching of my muscles on my right hand side neck, shoulder, arm, chest (front and back) are assisting with improvement and I will continue to explore this further.
Once again thank you kindly to your team of staff who have supported me over these past months, it has been an awful ordeal but I am much better for the surgery and ongoing treatment to improve my health.
What this means for invalidity retirement
The design of lifePLUS cover further integrates temporary and permanent disability benefits, which supports members as they recover from their injury or sickness while providing time to make determinations on a persons’ ability to ever work again.
Determining a person’s ability to ever work again is a serious matter. It can take time for the full extent of a person’s condition to become clear. For this reason, we have qualifying periods in place to make the fairest and most accurate assessment possible. The default qualifying period is now 24 months, although depending on the injury or sickness and the resulting part of the Total and Permanent Disablement (TPD) definition that applies, the qualifying period may be 6 months or not apply at all.
This also means it may take CSC longer to issue an invalidity retirement certificate.
Maximising return to work opportunities ...
Engage with us early.
To maximise the success of our rehabilitation and early intervention programs, it is important for us to engage with the injury or sickness early. There is no need to wait for the expiry of the member’s income protection waiting period to engage with us –a member should contact us about the claim process and their options as soon as they are aware that they might be off work for an extended period.
If you have a member on long term sick leave or who is in the process of lodging a Comcare claim, contact our Employer Relations Team to find out how we can support you and our members.
You should note that our insurance products can run in conjunction with a Comcare process – we work collaboratively with Comcare and can complement with a broader range of rehabilitation options and financial support if the Comcare claim is declined or delayed.
… and ensuring efficient processing of an invalidity retirement request if return to work is not an option
The earlier we are aware of a potential invalidity retirement, the earlier we can begin to work with the member to progress the relevant claim, whether that be income protection or TPD. Where return to work and rehabilitation is not successful or a viable option, we can begin the process of assessment and approval to ensure that the claim is dealt with as sensitively and efficiently as possible.
The importance of early notification—Recently a PSSap member contacted us in a distressed state regarding the time it took to assess her claim. The member was about to be evicted for failure to pay her rent and the financial worry was impacted her medical recovery.
While we had only recently received the claim, the member had been off work for about 6 months and was relying on her Comcare claim to be approved so she could meet her financial obligations. It was only when this claim was declined by Comcare that an income protection claim was lodged. Unfortunately, the delay in us being notified of a claim has limited the opportunity for rehabilitation and placed undue stress on the member.
Happily, this story ends well – we were able to work with our insurer to ensure that there was no rental eviction and thankfully the right outcome was achieved for the member.
An enhanced case management approach
To coincide with the new cover, we are also enhancing the way we manage insurance claims. Members will be assigned a dedicated case manager to monitor their claim and liaise with the insurer to achieve the right outcome for their situation. Members will also have the option to lodge claims information online, meaning faster lodgment and less paperwork.
What this means for you
- This case management approach will improve the process for your members. It will make it easier for you to provide information, gain updates and provide better support, particularly in highly sensitive or complex cases.
- We are moving to an electronic lodgement of employer statements, making it quicker and easier for you to provide the information needed to progress a claim. We recognise that in some cases, paper forms will still be required and in special circumstances these will be made available to members.
Other new features
We know that membership in a Commonwealth superannuation scheme is an attractive employee benefit for the Australian Public Service. Our lifePLUS cover was designed exclusively with Australian Government employees in mind and includes product enhancements that make PSSap membership even more valuable for your employees.
- Providing coverage to PSSap Ancillary members
- Default Income Protection benefit period of 5 years on lifePLUS auto cover or 2 or 5 years on lifePLUS choice cover (or the end of the current contract for non-ongoing contract employees, if this ends earlier)
- Terminal illness certification period is now 24 months (increased form 12 months) and is now equal to the death benefit.
- Income protection that includes (subject to amending legislation) an amount equal to 15.4% of the Base Annual Salary paid into the members PSSap account, so they can continue to grow their super while unable to work
- Extended coverage for members on LWOP
- Higher levels of maximum cover for both Death and TPD and Income Protection, and
- Ability to retain cover within PSSap upon leaving APS employment (or exercising choice of fund) without needing to make a further application.