Personal insurance in super

Superannuation is not just a savings vehicle for retirement. You may also be able to take out personal 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 personal insurance in place through your fund. If you’re not sure, contact your super fund for more information.  

Who pays for personal insurance?

When you take out personal 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.

Do you have enough personal insurance cover?

If you do have personal 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.

To learn more about insurance options in super, contact us or speak to your financial adviser.

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 determine the amount of super you 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.

Information current as at 1/11/2019.

This information does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness, having regard to your personal objectives, financial situation and needs having regard to these factors before acting on it.

BT Protections Plans, including Term Life Insurance, Total and Permanent Disablement Insurance, Living Insurance and Income Protection Insurance
BT Protection Plans are issued by Westpac Life Insurance Services Limited ABN 31 003 149 157 (WLIS), except for Term Life as Superannuation and Income Protection as Superannuation which are issued by BT Funds Management Limited ABN 63 002 916 458 (BTFM) as trustee of the Retirement Wrap ABN 39 827 542 991. WLIS and BTFM are wholly owned subsidiaries of Westpac Banking Corporation ABN 33 007 457 141 (the Bank). The Bank does not guarantee the insurance. 

The information in this document does not take into account your personal circumstances. The insurance is subject to terms and conditions, and limitations and exclusions apply. Please read the Product Disclosure Statement to see if this insurance is right for you.