TPD & Life Insurance
5. Insurance Thru Super Funds
Authors: Staff Legal Eagle
Firm / Chambers:
Last updated: 11 Aug 2015
- The following types of insurance exist under a super fund:
- life insurance;
- TPD insurance; and
- income protection insurance.
- Income protection insurance is a type of insurance that provides the policy holder with an income stream for a short period of time if they cannot work due to temporary disability or illness.
- Most people hold life and TPD insurance under their super fund as the premiums are cheaper and deducted directly from the super fund.
- You must always get financial and legal advice when considering setting up a Self Managed Super Fund (SMSF) or changing super funds as your life and TPD insurance in your current super fund may not be transferable to your new fund.
- Most super funds have a minimum cover which is called the ‘default cover.’
- It is important to note however that such ‘default’ life insurance under a super fund is often inadequate to protect you and your family’s financial needs.
- You must check the Product Disclosure Statement of your super fund to understand the details of your cover. Always speak to a lawyer if you are unsure about what the information stated under your policy documents means. You can use our free Find a Lawyer directory to contact a lawyer near you.
- If you require additional cover you can contact your super fund and choose a cover that is more appropriate for your circumstances.
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