Putting Members’ Interest First – Frequently Asked Questions

These FAQs have been prepared to help you understand the recent changes to insurance through superannuation. We recommend you contact our Member Services team on 1300 658 776 if you have further questions.

Download Election to maintain insurance form

Download Insurance Factsheet

  • 1. What are the changes and why is the government making them?
    Recently the Government made changes to the rules for insurance in superannuation. These changes are aimed at stopping your superannuation balance from being unnecessarily eroded by insurance premiums.   

    The changes stop us from providing insurance cover to you if your super account balance hasn’t reached $6,000 between 1 November 2019 and 31 March 2020. This is a one-off measure to cancel insurance cover on low balance accounts. If your super balance reaches $6,000 or you opt-in to keep your insurance in writing by 31 March 2020, it won’t be cancelled.
  • 2. What types of insurance cover do we provide?

    The three types of insurance that we provide through super include:

    1. Death cover (including terminal illness) – pays a lump sum to your beneficiaries if you die or suffer a terminal illness.
    2. Total and permanent disability (TPD) – pays a lump sum if you suffer an illness or injury that means you are unlikely to ever work again.
    3. Income protection (IP) – pays a monthly income while you are unable to work due to illness or injury. It is paid for a maximum time period (e.g. 2 years known as the benefit period), which can be changed to suit your requirements.

    Learn more here.

  • 3. How much insurance do I need?
    Your insurance needs – including death cover, TPD cover and income protection cover - will reflect your personal circumstances, which may include whether you are single, have a partner or a family.

    You may also want to work out how much money your family could already receive if something happened to you and you lost your earning power. This may include savings, paid leave, shares, or superannuation. These amounts may be taken into account in determining how much you would then need in insurance.
  • 4. What are the benefits of having insurance?

    Insurance is about protecting people from financial difficulty after an unexpected event, like an illness, injury or death. Depending on the level of insurance cover and terms of the policy you may be covered for situations when you need it most. 

    There are benefits in getting your life insurance through super, such as;

    • - It's often cheaper because we purchase insurance policies in bulk.
      - You can get the cover you need for you and your family, even if money is tight.
      - It's easy to manage because premiums are automatically deducted from the balance of your account.
      - Default cover may be provided to employer sponsored members without requiring a health check.
      - You can apply to change the amount you want to be covered for.

     For further information visit the ASIC MoneySmart site.

  • 5. What are the drawbacks of insurance provided through superannuation?

    Some of the drawbacks include:

    • - Reduces super balance: The cost of insurance premiums are deducted from your super balance, reducing the money available for your retirement, if the investment returns for your account are lower than the total fees, premiums and taxes charged your account balance will decrease.
    • - Default Cover: The default amount and type of cover is not tailored to your individual circumstances.
    • - Subject to cancellation: If you change super funds; have an extended absence from your employer; your employer's super contributions stop or your account balance drops below a certain amount, your cover may cease and you could end up with no insurance.
    • - Ends at specific ages: income protection ends at age 65; Death and TPD insurance ends at age 70. Policies outside of super may cover you for longer.
    • - Multiple super accounts: If you have more than one super account, you may be paying premiums on multiple insurance policies. This could reduce your retirement money, especially where you can only claim on one policy.
    • - Premiums may increase or cover may decrease: Depending on your type of cover the amount you are insured for may decrease as you age or the cost of that cover may increase.

    For further information visit the ASIC MoneySmart site.
  • 6. What will happen if my insurance is cancelled?
    If it is cancelled, no further insurance premiums will be deducted and you will lose the ability to make an insurance claim, if your injury or illness occurs after that date. 

    Generally it’s not as easy as re-applying for insurance and your application will need to be assessed by our insurer. As part of this process you may need to provide some further information on your employment and medical conditions.
  • 7. Will the cancellation of insurance be indefinite?
    Cancellation of insurance may not be indefinite, as under the rules for default cover you may receive insurance in the future if you meet the relevant criteria. 
  • 8. What are the things I should consider in making a decision?
    Whether you currently hold insurance, are looking to take out insurance or want to opt-out, we recommended that you review your personal circumstances before making a decision, such as:

    - Your personal insurance needs
    - Your current level of cover
    - Cost of insurance cover
    - Super account balance 
    - Insurance policy terms and conditions

    You can access details about your super and insurance through our member portal.

    Further information that may assist you, is available through the ASIC MoneySmart site.

  • 9. What should I do?
    Everyone's needs and circumstances are different, it is recommended that you review your insurance arrangement to meet your personal needs. 

    You can contact our Member Services team on 1300 658 776 for further information. 
  • 10. I have insurance – What ways can I lose insurance under the new rules?
    Unless you have made an election to keep insurance, you can lose your insurance cover if:

    - Your account balance has not reached $6,000 between 1 November 2019 and 31 March 2020; or
    - Your superannuation account has been inactive for 16 months or more.

    Please note in addition to the insurance rules above, cover is still subject to the terms and conditions of the policy, see the Insurance Factsheet for further details. 
  • 11. How can I make sure my insurance does not get cancelled?
    All you need to do is elect to keep your insurance. You can download the insurance election form from our website, fill it in and send it back to us before 31 March 2020.
  • 12. If I make an election can I opt-out in the future?
    Yes, electing to maintain your insurance doesn’t affect your rights to opt-out or apply for changes to your cover in the future. If you’d like to opt-out or make changes to your insurance, you can log in to our member portal or contact our Member Services team on 1300 658 776.
  • 13. Will insurance be reinstated automatically in the future?
    If you lose insurance cover on 31 March 2020, you may be eligible for reinstatement of the default level of cover in the future if you are an employer sponsored member and receive an employer contribution whilst your account balance is more than $6,000 and you are aged 25 or over. 

    Personal members will not have cover reinstated automatically. If you want cover, you must apply to the insurer and your application will be subject to underwriting.
  • 14. Are there any exceptions to the cancellation of cover?
    The Fund has not applied for any exceptions, and cancellation will be applied as per government rules irrespective of your occupation or where you are employed.  
  • 15. I don’t have any insurance and don’t want any insurance in the future - do I have to do anything?
    If you never want to receive insurance, you will need to tell us as you may be eligible for default insurance cover in the future. You can opt-out by; 

    - logging onto our member portal,
    - contacting our Member Services team on 1300 658 776

  • 16. Where can I get more information?
    If you are unsure about whether or not you should be taking any action, we encourage you to seek your own advice or contact our Member Services team on 1300 658 776.
  • 17. General
    All insurance cover is subject to the terms and conditions of the insurance policies. You can request a free copy of the insurance policies, and/or download the Insurance Factsheet

    We encourage you to review this page from time to time as the information may be updated with further guidance.