Disclosure Statement: Durand Financial Services Pty Ltd and its advisers are authorised representatives of Fortnum Private Wealth Ltd ABN 54 139 889 535 AFSL 357306. General Advice Warning: The information contained within this website does not consider your personal circumstances and is of a general nature only. You should not act on it without first obtaining professional financial advice specific to your circumstances.
People who held policies with collapsed insurer Youpla as of April 1, 2020, will receive payouts for funeral expenses.
The federal government announced on Monday that as many as 500 people impacted by the collapse will get access to payments in line with the cover eligible policy holders took out in good faith prior to Youpla Group’s collapse, typically worth around $8000.
The arrangements will be in place until November 30, 2023.
“These are interim arrangements the government intends to establish while it investigates what further steps are required to bring resolution in relation to the Youpla Group collapse,” Assistant Treasurer Stephen Jones said.
Financial counsellor Bettina Cooper lobbied for the intervention and welcomed the government stepping in to ensure funeral services could take place.
“The fact that we are able to pick up the phone and tell somebody, ‘Hey, it’s OK, there’s a way you bury your family’ … and you don’t have to take out loans, withdraw your super or have yourself further traumatised – that’s a huge thing,” she said.
Mr Jones said the first priority was to limit the immediate cultural damage and community grief Youpla Group’s liquidation had brought about.
“It’ll take us a few weeks to put in place the mechanisms to make this happen. The commonwealth government has not been in the funeral business,” he said.
“There’s going to be different needs for somebody living in a remote community in north Queensland with limited internet connection. Telling somebody to go to a website is not the most effective way to make a claim.
“We’ll work with First Nations communities to work out the most effective, efficient, culturally appropriate way to do that.”
People affected can register on the Treasury website and a phone service will be available, Indigenous Australians Minister Linda Burney says.
“It’s not the full answer. But it’s a good way of dealing with the first tranche,” Ms Burney said.
“We’re talking to a number of government agencies that will be involved in administering the scheme, but I can assure you there will be someone on the end of the phone line for people to talk to.”
Ms Burney said “Sorry Business” is of the deepest cultural importance to Indigenous people.
“It’s vital that traditional mourning practices be allowed to continue despite the collapse of the Youpla Group funeral contribution funds earlier this year,” she said.
“This company has beached moral responsibility. It’s breached cultural responsibilities, and it’s breached the trust of thousands and thousands of First Nations people.”
The decision for the government to step in with funding came after a campaign by the Save Sorry Business coalition, a group of more than 125 organisations.
Aboriginal Community Benefit Fund, which traded as Youpla, sold junk funeral plans to Aboriginal and Torres Strait Islander people across Australia for decades before coming to the attention of the banking royal commission and regulators.
The Australian Securities and Investments Commission had been investigating Youpla and its group of funeral contribution funds since the collapse.
The first priority remains with allowing families to bury their loved ones in a culturally appropriate way and then setting up long-term reforms before the government seeks to investigate “who knew what, when”, Mr Jones said.
Paul Osborne and Dominic Giannini
(Australian Associated Press)