First State Super (aka “the new scheme”, or FSS) has operated since December 1992. Permanent firefighters who have joined the Brigades since that time, and all retained firefighters are in the FSS scheme, save for the small percentage of members who’ve gone with a private super fund instead. The proposed new D&D arrangements will apply to all of these members (including those in private super funds). These members will not have the ability to opt out of the D&D cover, and member D&D contributions will be compulsory.
Unlike SSF and SASS, FSS does not provide a PPI benefit. Instead, FSS offers a Death or Invalidity (“DORI”) insurance option in the event of death or Total and Permanent Incapacity (TPI). This cover works on the basis of the number of DORI units a member has chosen to take out (from 1 to 5) – the more units you have, the larger the death or TPI cover. FSS members can opt into (and out of) their DORI cover at any time.
All FSS members are automatically given 1 unit of “Basic” DORI cover as soon as their FSS account balance reaches $1000. This first “Basic” unit costs $5.00 per month, and is deducted by FSS from your account. Each unit of “Additional” DORI cover costs a further $4.17, so if you purchased all 5 DORI units then it would cost you $5.00 per month for the first Basic unit and a further $16.68 per month for the four Additional units ($21.68 per month).
Each DORI unit you hold is worth a lump sum death/TPI amount which decreases as the member’s age increases. By way of example, each unit of DORI is worth:
Up to age 35 = $38,000
@ age 40 = $30,400
@ age 45 = $12,400
@ age 50 = $6,700
@ age 60 = $1,900
Therefore, a 35 year old FSS member who took out all 5 DORI units would pay $260.16 per year for $190,000 of death/TPI cover. However, a 50 year old member with 5 DORI units would still pay $260.16 per year, although they would only have $33,500 of death/TPI cover.
The impact of DORI on the new D&D benefits
Point No. 1 in the D&D “Heads of Agreement” between the Union and the Government (see Union website, 5 June) provides that “The Award Death and Disability benefit for members of FSS is to be reduced only by the amount of any death or TPI benefits payable under the FSS ‘DORI’ benefit.” In other words, your D&D payment will be reduced by what DORI payment (if any) you receive from FSS. By way of example, if a 40 year old Senior Firefighter suffered on-duty TPI and did not have any DORI cover, then she would qualify for a lump sum D&D benefit of $720,720. However, if the same firefighter held all 5 units of DORI, then her D&D benefit would be reduced by the amount of her DORI payment (Final D&D benefit would be $720,720, less the DORI payment of $30,400 = $690,320).