Protect against longevity risk - Challenger
The primary object of the superannuation system needs to change to encompass delivering a comprehensive income product for retirement, according to annuities-focused group, Challenger.
In a response to the Financial System Inquiry (FSI) final recommendations, Challenger chief executive, Brian Benari said achieving the primary objective of the superannuation system "requires changing the focus from accumulating funds to delivering retirement incomes and a comprehensive income product for retirement (CIPR) is an important step".
"The proposed pre-selection or opt-in model is consistent with other choice features of the superannuation system but, as the FSI Report recognised, that choice needs to include a product that protects retirees from outliving their savings," he said. "To improve the retirement framework it's absolutely critical to protect against longevity risk. Anything less is just the status quo."
Benari said Challenger's submission had emphasised that CIPRs needed to meet individuals' needs as far as they were identifiable and foreseeable and could be catered for with a practical and efficient product.
He said the submission suggested that superannuation funds offer members a number of CIPRs, not necessarily a best fit solution for all members, though all CIPRs should include consideration of risks including longevity protection.
The submission, Benari said, suggested that the size of superannuation assets, eligibility for the Age Pension and, age at retirement were amongst the key factors influencing an individual's needs from a CIPR.
Recommended for you
The insurance company has joined this year’s awards as a principal partner.
The $135 billion fund has transitioned away from TAL Life Insurance following an “extensive tender process”.
The $80 billion fund is facing legal action over allegedly signing up new members to income protection insurance by default without active member consent.
In a Senate submission, the Financial Services Council has once again called for further clarification that the government will assess the consumer outcomes of group insurance against the enshrined objective of superannuation.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Loftus Peak Global Disruption Fund Hedged
118.15 3 y p.a(%)
2
Global X 21Shares Bitcoin ETF
75.00 3 y p.a(%)
3
DomaCom DFS Mortgage
67.30 3 y p.a(%)
4
UBS Solactive Global Pure Gold Miners UCITS ETF Dis USD
61.11 3 y p.a(%)
5
Global X Ultra Long Nasdaq 100 Complex ETF
60.93 3 y p.a(%)
