On this page
- What does income protection cover?
- Understand your existing cover
- Super funds with lowest income protection insurance premiums – 45-year-old female
- Super funds with lowest income protection insurance premiums – 55-year-old female
- Super funds with lowest income protection insurance premiums – 45-year-old male
- Super funds with lowest income protection insurance premiums – 55-year-old male
Paying too much for Income Protection insurance inside your super fund can cost you dearly, eating into your retirement savings without necessarily improving your cover.
Income protection (IP) insurance (sometimes called salary continuance insurance) is available through about a third of super funds as default cover. It is one of three kinds of insurance available inside super, alongside life and TPD, and is the least common.
What does income protection cover?
Income protection insures against the risk that you can’t earn an income for a certain period due to an injury or illness, but not redundancy.
Super funds vary in their terms and conditions, but generally you can get IP if you are under age 65 and at least age 15.
The maximum amount you can insure is 85% of your pre-tax (and pre-disability) salary, or up to a monthly figure of $25,000 or $30,000 typically. That 85% would include an amount for super, which would be paid into your super account, while the rest of the benefit is paid to your bank account.
Learn more about how income protection insurance works.
Understand your existing cover
Insurance was a big area of interest for the recent Productivity Commission (PC) on superannuation, not least because 12 million Australians have insurance through their super.
Unfortunately, a large percentage of those policies are unintended or duplicate policies.
The PC estimated that in 2017 17% of members had two or more accounts with insurance, and that this was costing Australians approximately $1.9 billion per year in excess insurance premiums.
A lot of this is down to a lack of awareness…
While most members have some awareness of the insurance included in their superannuation, 24 per cent of members did not know if there was insurance in their fund and 16 per cent know they pay for insurance but do not know what it is. Few members (12 per cent) said they knew ‘a lot’ about their insurance.
Learn more about insurance in super in the following SuperGuide articles:
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As with most financial matters, it pays to be informed. In this article you can discover which super funds offer the lowest rates for income protection insurance, and we’re grateful to SuperRatings for providing this information. Note that all lists are based on a white-collar employee.
See also the super funds with the lowest rates for combined life insurance and TPD insurance.
|
Super fund and product |
Cost Per $1000 |
|---|---|
|
$2.00 |
|
|
MTAA Super |
$2.37 |
|
First State Super Personal Division |
$2.90 |
|
LUCRF Super |
$2.99 |
|
AustralianSuper |
$2.99 |
|
VicSuper FutureSaver – PersonalSaver |
$3.38 |
|
Australian Catholic Superannuation – Personal Plan |
$3.61 |
|
Catholic Super |
$3.65 |
|
MyLife MySuper |
$3.65 |
|
NGS Super – Industry Plan |
$3.78 |
|
Sunsuper for Life Business – savings account |
$3.99 |
|
legalsuper |
$4.07 |
|
BUSSQ – Premium Choice |
$4.28 |
|
Vision Super Saver |
$4.33 |
|
Hostplus Superannuation Fund |
$4.33 |
|
Nationwide Super – Personal Division |
$4.38 |
|
TWUSUPER – Industry |
$4.72 |
|
Smartsave – Personal |
$4.75 |
|
smartMonday DIRECT |
$5.04 |
|
brightday Complete Super |
$5.10 |
Source: SuperRatings
|
Super fund and product |
Cost Per $1000 |
|---|---|
|
Christian Super |
$4.00 |
|
MTAA Super |
$5.33 |
|
VicSuper FutureSaver – PersonalSaver |
$5.63 |
|
AustralianSuper |
$5.85 |
|
LUCRF Super |
$5.90 |
|
First State Super Personal Division |
$6.84 |
|
StatewideSuper Personal |
$7.53 |
|
NGS Super – Industry Plan |
$7.89 |
|
legalsuper |
$7.95 |
|
BUSSQ – Premium Choice |
$8.41 |
|
Hostplus Superannuation Fund |
$8.51 |
|
Australian Catholic Superannuation – Personal Plan |
$8.53 |
|
Sunsuper for Life Business – savings account |
$8.58 |
|
Nationwide Super – Personal Division |
$8.77 |
|
HESTA – Industry Super Plan |
$9.76 |
|
MLC MasterKey Super Fundamentals |
$9.78 |
|
Vision Super Saver |
$9.97 |
|
Catholic Super |
$10.29 |
|
MyLife MySuper |
$10.29 |
|
CareSuper |
$10.34 |
Source: SuperRatings
|
Super fund and product |
Cost Per $1000 |
|---|---|
|
Christian Super |
$1.60 |
|
LUCRF Super |
$2.30 |
|
MTAA Super |
$2.37 |
|
Nationwide Super – Personal Division |
$2.75 |
|
First State Super Personal Division |
$2.90 |
|
AustralianSuper |
$2.99 |
|
NGS Super – Industry Plan |
$3.02 |
|
Sunsuper for Life – Super-savings Account |
$3.03 |
|
legalsuper |
$3.16 |
|
Perpetual Select Superannuation Plan |
$3.16 |
|
Smartsave – Personal |
$3.17 |
|
Freedom of Choice – Personal Superannuation Service |
$3.28 |
|
BUSSQ – Premium Choice |
$3.36 |
|
smartMonday DIRECT |
$3.37 |
|
VicSuper FutureSaver – PersonalSaver |
$3.38 |
|
Hostplus Superannuation Fund |
$3.40 |
|
MLC MasterKey Super Fundamentals |
$3.42 |
|
brightday Complete Super |
$3.48 |
|
$3.52 |
|
|
$3.59 |
Source: SuperRatings
|
Super fund and product |
Cost Per $1000 |
|---|---|
|
Christian Super |
$3.70 |
|
LUCRF Super |
$5.21 |
|
MTAA Super |
$5.33 |
|
VicSuper FutureSaver – PersonalSaver |
$5.63 |
|
AustralianSuper |
$5.85 |
|
Nationwide Super – Personal Division |
$6.07 |
|
NGS Super – Industry Plan |
$6.31 |
|
MLC MasterKey Super Fundamentals |
$6.52 |
|
Sunsuper for Life – Super-savings Account |
$6.74 |
|
First State Super Personal Division |
$6.84 |
|
CareSuper |
$6.98 |
|
legalsuper |
$7.04 |
|
StatewideSuper Personal |
$7.53 |
|
BUSSQ – Premium Choice |
$7.70 |
|
Freedom of Choice – Personal Superannuation Service |
$7.70 |
|
Smartsave – Personal |
$7.71 |
|
Hostplus Superannuation Fund |
$7.78 |
|
smartMonday DIRECT |
$7.79 |
|
Prime Super |
$7.92 |
|
Perpetual Select Superannuation Plan |
$7.93 |
Source: SuperRatings
Disclaimer: The information used in compiling this data comes from sources considered reliable and is not guaranteed to be accurate or complete. This information is general in nature and is not intended to be a recommendation for a particular financial product, or a type of financial product in general. We recommend you seek independent financial advice before making a decision on a financial product.