INSURANCE

Important rules on insurance

There are rules around the provision of insurance in super that mean your cover can get turned ‘on’ or ‘off’ in certain circumstances. Taking control means the decision is always up to you.

Keep or cancel cover

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KNOW THE RULES

Rules around insurance

There are government set rules around insurance in super that are aimed at protecting low balance and inactive super accounts from having their balances reduced by fees, including insurance fees. These rules mean that some members may have their insurance cover turned ‘on’ or ‘off’ in certain circumstances. The good news is that, if eligible, you can choose whether to ‘opt in’ to start or maintain your insurance.

When will insurance get ‘turned on’?

  • Eligible members, who are under 25 years old or who have less than $6,000 in their account when they join, will not receive automatic insurance cover.
  • Members who turn 25 years old and have an account balance of $6,000 or more will have any eligible automatic insurance cover turned on.
  • Members aged 25 years or older, whose account balance grows to more than $6,000 as a result of contributions or rollovers, will have any eligible automatic insurance cover turned on.

When will insurance get ‘turned off’?

  • Members with an account balance that drops below $6,000 will have their insurance cancelled.
  • Insurance cover will also be cancelled on inactive accounts. An account is considered inactive if it has not received a contribution or rollover for 16 months.
  • Once the insurance cover is turned off, any subsequent insurance cover may be subject to assessment and approval by us and the insurer.

INSURANCE IN SUPER

Should you have insurance cover in super?

The choice is yours. You can decide whether you would like to keep your insurance cover or are happy for it to be cancelled. You can also tell us which types of cover you want to retain.

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Reasons to have cover

  • Insurance can help you and your loved ones pay the bills and keep things going if something happens to you.
  • Insurance through your super is usually cheaper, as we use bulk purchasing power to negotiate competitive prices on your behalf.
  • Insurance fees are paid out of your super balance, not out of your pocket.
  • If you decide later that you want to reapply, your health, lifestyle and occupation will be assessed, after which the insurer will decide whether to accept your application.

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Reasons to not have cover

  • Premiums for your insurance cover can erode your retirement savings.
  • You may have other cover with another super fund, or outside the super system.
  • You may not need certain types of cover such as Death cover, because you don’t have any dependants.
  • Keeping your cover means paying multiple sets of fees to keep your super account open.

More information

Need more information before making a decision?

  • Read the FAQs to find out about how these laws can affect your insurance cover with us.
  • Visit MoneySmart > Insurance > How life insurance works > Insurance through super.
  • Get expert advice about the best insurance arrangement for your circumstances.

TAKE ACTION

Keep or cancel your insurance cover

To take either action at any time, log in to your online account and complete the Insurance Request Form available in the Resources section.

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USEFUL RESOURCES

Forms and fact sheets

More fact sheets

Looking for a different fact sheet? Visit our Resource Centre to find more fact sheets.

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