Insurance in super

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Insurance in super

Over 10 million Australians have insurance through their super account. Are you one of them?

If your answer is, ‘I don’t know’, don’t worry, you’re not alone! Insurance, especially through super, is one of those topics that can seem mysterious, but it doesn’t have to be. Let’s break it down.

What do we mean by insurance ‘in’ super?

Great question! As a member of a super fund, it’s common for some members that insurance is automatically included. We offer Income Protection, Death Cover and Total and Permanent Disablement cover. You can learn more about the different types of insurance here.

Most super funds offer you what is called “default insurance”, which is basically a standard insurance package that hasn’t been tailored specifically for you. It’s worth noting that you won’t automatically get this default insurance unless you’re 25 years old + and have at least $6,000 in your account. If you don’t meet these criteria, don’t worry, you can still get default insurance. But also, if you DO meet these criteria and don’t want default insurance automatically given to you, you’ll need to contact us to change or cancel your insurance.

Take the time to log into your member account now, check what insurance you have (if any) and think about whether it’s right for your personal circumstances. For example, if you have dependents and a mortgage, you’re more likely to need a higher level of cover than someone with no dependents or financial assets.

Don’t forget, it’s possible to be over-insured as well as under-insured, so it’s worth checking that you aren’t paying for a bunch of stuff you don’t need. But if you’re a fly-by-the-seat-of-your-pants type gal, DON’T just go and cancel everything without understanding the consequences (more on this later!). It’s best to consult a licensed financial advisor if you have any questions about whether your default insurance package is right for you.

So…what does the insurance cost me?

While insurance in super isn’t free, it’s normally a lot cheaper than if you buy it through a separate insurance company. Plus, you don’t have to cough up for monthly or annual bills (known as premiums) like you do with other types of insurance, such as car insurance. But it is important to remember you are still paying for it – the premium is just coming out of your retirement savings rather than your bank account.

Learn more about the specific fees and costs associated with insurance through your GuildSuper account.

The perks of having insurance through GuildSuper

We’ll go from least to most complicated, so stick with us!

Number One Award

Perk #1

Our insurer, Metlife, is regarded as one of the industry’s best when it comes to speed and approval of paying out claims.

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Perk #2

For automatic cover, you won’t have to go through the (often painful) underwriting process. We recommend checking out change your insurance if you want to know more about underwriting, but the key takeaway is insurance in super has a lot less life admin attached than other types of insurance!

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Perk #3

Our fund (unlike many others) allows eligible members to ‘top up’ your Income Protection insurance when you hit certain life-events such as getting your first mortgage, getting married or having kids. This is awesome because you get a higher level of cover, without having to provide any health information or extra paperwork.

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Perk #4

Finally, let’s talk about something called pooling. Pooling is a thing that life insurers do when they are assessing risk. Risk is relevant because it has an impact on how much insurance costs. Essentially, the higher the risk, the higher the cost.

Pooling is when the risk of a whole group of people is assessed as one, such as all the members of a super fund. Because we are a female-dominated fund we’re considered a lower-risk group (for a whole bunch of reasons like life expectancy, common types of jobs we hold etc) so our insurance has been selected to suit our member base. Don’t worry if you find the concept of pooling a little tricky to understand, the main thing to remember is that compared to some other funds, GuildSuper's member base is considered a lower-risk group, which is a good thing when it comes to your insurance.

Are there any downsides to insurance through super?

Okay, so we’ve spoken about the pros, but in the interest of transparency we want to let you know there are some potential downsides to having insurance through super.

Sometimes the cover that is included through super will be for a smaller amount than what you would get if you took out separate insurance. This might not be a problem for you (depending on your personal circumstances) but it’s something to keep in mind.

If you haven’t consolidated your super funds, you may be paying for multiple sets of insurance without even realising it. The simple solution here is to consolidate to one fund – and make sure insurance is one of the factors you consider. Make sure your new fund offers insurance you are eligible for before you consolidate.

Find out more about transferring your cover into GuildSuper.

Page last updated 1 December 2023