Insurance in super

Superannuation is not just a savings vehicle for retirement. You may also be able to take out insurance, including life cover, through your fund. 

Protection through superannuation

As well as being able to grow your retirement savings, your super fund may also offer life insurance to protect you and your family. It could also be a cost effective way to pay for insurance cover, as the premiums are deducted from your super balance rather than your take home pay. 

Three main types of cover through superannuation

Superannuation funds generally provide members with the option to take out three types of personal insurance:

Life insurance – this provides a lump sum payment to the people you nominate when you pass away. You may also be able to make a claim on life insurance if you are diagnosed with a terminal medical condition.

Income protection insurance – this type of cover provides a regular payment of usually up to about 80% of your normal wage or salary if you can’t work due to illness or injury. In super, however, you can apply for a maximum of 75% of salary plus Super Guarantee contributions. 

Total and permanent disability (TPD) insurance – this pays a lump sum if you become seriously disabled and are no longer able to work. 

Your most recent superannuation statement should show if you have any insurance in place through your fund. If you’re not sure, contact your super fund for more information.  

Who pays for insurance?

When you take out insurance through your super, the cost of cover (the premium) is paid out of your superannuation balance. This could be a cost-effective way to pay for insurance cover.

As super funds arrange ‘group’ cover for a large number of fund members, the premiums can be cheaper than if you were to arrange your own, separate insurance directly through an insurer.

Should you have insurance in super?

Everyone’s circumstances are different – so the decision to have insurance through your super account will depend on different things for everybody. 

Insurance helps provide financial security for you and your family when it's needed most. However, it’s important to understand that the cost of the premiums can reduce the amount of money available to you in retirement. When reviewing the insurance cover in your super account, you may want to consider:

  • if you have other insurance cover elsewhere;
  • the types of insurance you currently have and whether you have the right amount of cover; and
  • the insurance premiums you are currently paying.

You can also refer to the Moneysmart website at moneysmart.gov.au for more information on insurance provided through super and use their insurance calculators, or contact your financial adviser (if you have one).

Do I have enough insurance cover?

If you do have insurance through your super, make sure you have sufficient coverage in place to meet the needs of you and your family (such as, how much cover you might need). 

If it turns out you are uninsured, you may be able to top up your level of cover through your fund, or, consider taking out insurance directly through an insurer of your choice. 

Next: Taking control of your super

Take control of your super today to potentially enjoy a more financially rewarding retirement. By the time you retire, your super could be one of your most valuable assets.

Who is the insurer for BT super products?

We have partnered with AIA Australia Limited (AIA), to bring our BT Super and BT Super for Life members help when they need it most.

AIA is an award-winning global insurer with over 47 years’ experience in Australia, that shares our philosophy of supporting the health and wellbeing of our members. They provide life insurance for some of Australia’s largest super funds and currently protect over four million Australians.

Their claims philosophy is simple – helping members, making sure every claim that should be paid is paid, and payments are prompt and correct.

Together with AIA, we provide a range of programs to support your health and recovery including early intervention and wellbeing programs.

Find out more about AIA and how it can help BT super members

We explain the range of strategies you can use to help grow your super. Try just one or embrace them all to boost your super savings over time.
Learn how to estimate the amount of super you may need to support your preferred retirement lifestyle. It’s about finding the retirement number that’s right for you.
We look at why it is important to check your super savings on a regular basis to see how you are progressing towards achieving your goals and prepare for the best.

Important information

Information current as at 11 November 2020.

This information does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness, having regard to these factors before acting on it. This document provides an overview or summary only and it should not be considered a comprehensive statement on any matter or relied upon as such.  This document may contain material provided by third parties derived from sources believed to be accurate at its issue date. While such material is published with necessary permission, the Westpac Group accepts no responsibility for the accuracy or completeness of, nor does it endorse any such third party material. To the maximum extent permitted by law, we intend by this notice to exclude liability for this third party material. 

Awards are opinions only, are not recommendations and are only one factor to be taken into account when deciding to acquire, dispose or hold interests in BT Super and/or BT Super for Life Awards and ratings are current at the time of publication but are subject to change.

BT Funds Management Limited (BTFM) ABN 63 002 916 458, AFSL No. 233724, RSE No. L0001090 is the trustee and issuer of interests in BT Super for Life and BT Super which are a part of Retirement Wrap ABN 39 827 542 991, RSE R1001327. A Product Disclosure Statement (PDS) for BT Super for Life and BT Super, and the BTFM  Financial Services Guide (FSG) can be obtained by calling 132 135, or by visiting bt.com.au. You should obtain and consider the PDS before deciding whether to acquire, continue to hold or dispose of interests in BT Super for Life and/or BT Super.

An investment in BT Super for Life and/or BT Super is not an investment in, deposit with or any other liability of Westpac Banking Corporation ABN 33 007 457 141 (Westpac) or any other company in the Westpac Group. It is subject to investment risk, including possible delays in repayment of withdrawal proceeds and loss of income and principal invested. Westpac and its related entities do not behind or otherwise guarantees the capital value or investment performance of BT Super for Life and/or BT Super.

AIA Australia Limited ABN 79 004 837 861, AFSL No. 230043 is the issuer of insurance cover offered through BT Super and BT Super for Life. Further information about the insurance available through BT Super and BT Super for Life is included in the PDS.