Types of Insurance in Super
| Type | What It Covers | Typical Default |
|---|---|---|
| Life (Death) | Lump sum to your beneficiaries if you die | $100,000–$300,000 |
| TPD | Lump sum if you become totally and permanently disabled | $100,000–$300,000 |
| Income Protection | Monthly income (up to 75% of salary) if you can't work due to illness/injury | Not always included by default |
The Good
Insurance through super is often cheaper than retail policies because funds negotiate group rates. Premiums are deducted from your super balance, so it doesn't affect your take-home pay. And you may get cover without medical underwriting (depending on your fund and when you joined).
The Risks
Default cover may not be enough. If you have a mortgage, dependants, and debts, $200,000 in life cover might only last a few years. Also, insurance premiums eat into your super balance — over decades, this reduces your retirement savings. Review your cover annually.
Under-25s and Low Balances
Since 1 April 2020, super funds can't provide default insurance if you're under 25 or your balance is under $6,000. You can opt in if you want cover — contact your fund.
Frequently Asked Questions
Am I already covered?
Probably, if you have a super fund and are over 25 with a balance above $6,000. Log into your fund's website and check your cover type and amount.
Should I get insurance outside of super?
It depends on your needs. Super insurance is convenient and often cheaper, but policies outside super may offer better definitions, longer benefit periods, and don't erode your retirement savings.
Can I increase my cover?
Yes. Contact your super fund to apply for additional cover. You may need to provide medical information.