Insurance and super

Three types of insurance coverage are permitted to be provided within super funds:

• Life,
• Total and permanent disability (TPD), and
• Income protection.

A default level of insurance coverage is automatically provided when you join a super fund. However, it’s important that you regularly review whether or not the coverage provided is appropriate for your needs when your circumstances change over time.

Larger super funds can generally offer cheaper premiums than you could individually negotiate directly with insurance companies. However, if you’re a member of multiple super funds, you may have excess default coverage.

Self-managed super fund (SMSF) trustees must consider whether to take out appropriate insurance cover for each member of their fund as part of preparing their investment strategy.