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Weight loss surgery does not meet the "very high" threshold required to be able to withdraw KiwiSaver funds.
That is among the findings of the Financial Services Complaints which had received three recent complaints from people who had applied for the early release of their retirements savings on the grounds of serious illness.
Ombudsman Susan Taylor said the dispute service could not require a KiwiSaver supervisor to approve a withdrawal application, but could encourage them to reconsider an application if their decision was considered to be unreasonable.
However, she said supervisors in the three recent cases had not been unreasonable when they declined the early release of funds.
"In two of the cases, the complainants argued that they needed to access their KiwiSaver funds to pay for weight loss surgery. Their arguments were that if they did not have the surgery, their lives would be shortened or their ability to work would be affected," Taylor said.
"We understand that having an application turned down can be stressful, but it is important to remember that your KiwiSaver savings are there to ensure that you have enough funds to have a financially secure retirement."
The law defined a serious illness as an injury, illness, or disability that resulted in a KiwiSaver member being totally and permanently unable to engage in suitable work or that which posed a serious and imminent risk of death.
Industry guidelines indicated imminent meant death was impending or expected to occur within the next 12 months.
KiwiSaver supervisors had concluded that weight loss surgery did not qualify for a serious illness withdrawal because applicants regained the ability to work after surgery and the threat of death was no longer present.
Taylor said the dispute service had reached a similar conclusion in another case where the consumer had incurable cancer but was expected to live longer than 12 months.
"The threshold for an early KiwiSaver withdrawal is very high," Taylor said.
"Our suggestion would be for the consumer to speak to their KiwiSaver provider about a significant financial hardship withdrawal if they do not meet the criteria for a serious illness withdrawal.
"A KiwiSaver member might be eligible to withdraw their funds early if significant financial difficulties have arisen because of a medical condition, for example, because of medical treatment costs or reduced hours at work."