What is the Savings Provision Entitlement?
The Savings Provision Entitlement ensures that people remaining on a membership that has been eligible for the 35% or 40% rebate do not have their rebate reduced to the standard 30% when the member aged 65+ years leaves or cancels the membership.
How does the Savings Provision Entitlement work?
When the member of 65+ years leaves or cancels the original policy (due to death, divorce or separation), the Savings Provision Entitlement is triggered.
As a result, the original policy will continue to receive the higher rebate and the remaining members on the policy (at the time), other than dependents, will be entitled to receive the higher rebate if they transfer to a single policy or even a different fund.
If a member aged 64 or less leaves the policy before the member aged 65+ does, then the Savings Provisions Entitlement will not be triggered and the person leaving the policy will have their rebate revert back to 30%.
How do I lose the Savings Provision Entitlement?
If a policy is receiving the higher rebate as a result of a Savings Provision Entitlement, the Savings Provision Entitlement will be lost when another person, other than a dependant, is added to this policy. The rebate entitlement for the policy will be recalculated based on the age of the oldest person on the policy.
When does the Savings Provision Entitlement not apply?
A dependent is not entitled to take the Savings Provision Entitlement with them. This means if they take out their own policy, their rebate will revert back to the standard 30% rebate.