Don't let your hard work go to waste

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What are your insurance cover options as you approach retirement?

Is life insurance worth it as you approach retirement?

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Insurance in super helps protect the financial security you’ve worked hard to achieve.

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How will you continue to protect your family once you’ve retired? Life insurance isn’t irrelevant when you’re no longer working. Arguably, it’s even more important to ensure you and your loved ones are protected in case something unexpected happens. 

Why hold insurance through super?

In the lead-up to retirement, perhaps you’re re-evaluating what you spend money on. It’s worth knowing that life insurance through super is generally more affordable and easier to get than other life cover. 

There are three types of life cover available through super. Life cover, sometimes called ‘death cover’, pays an amount to your loved ones if you die or are diagnosed with a terminal illness and have 24 months or less to live. If you’re still working, there’s total and permanent disablement (TPD) cover if you become ill or injured and can’t work again. Income protection cover pays a percentage of your usual wage if illness or injury means you temporarily can’t work for a period.

There are some real benefits to keeping insurance cover through your super.

• Premiums for insurance cover through super can be significantly less than when you get a policy direct from the insurer. Super funds buy policies in bulk, which means the premiums are cheaper. But you can still adjust that cover to better suit your situation. 
• Because your premiums are paid out of your superannuation account, you don’t have to worry about being out of pocket when the bill comes due. 
• Most funds don’t require a medical check for you to access the default level of cover. Because they buy policies in bulk, they make certain general assumptions about people. This base level of coverage may be lower than what you can get outside super, but it is easier to obtain as well as costing you less. 

Does a pre-existing condition affect my insurance options?

As default levels of insurance are based on general assumptions about the population, it may not be suitable for your particular circumstances. This is especially true if you have a pre-existing condition.

Do you already have insurance through your super?

Until recently, most super funds provided automatic life insurance to their customers. This means that if you have more than one super account, there may be insurance that comes with it. It’s important to find this out before you retire, so you can weigh the benefits of consolidating your different super accounts and insurance policies.

Checking your current cover

If you took out your current policy before your health condition developed, it’s probably better to keep this original policy rather than taking out a new one. Your premiums are likely to be lower and, unless you’re making a claim related to that health condition, it’s likely you don’t have to tell your insurer about it. 

It’s always a good idea to check what the product disclosure statement (PDS) says about exclusions, whatever your current health condition. 

Increasing your cover

You can increase your level of cover from the default level relatively easily with insurance through super. However, you may need to give your medical history or undergo a medical check. If you developed a health condition since you took out the policy and apply now to increase it, your health condition will count as a pre-existing condition.

Transferring insurance

You probably know you can consolidate your superannuation into one account. Did you know you can, and should, move your insurance with it? 

It’s very important you check that your new super fund provides you with the level and type of insurance that you need. Be particularly careful if you are moving to a new super fund and have a pre-existing medical condition or are aged 60 or over.

When you roll your super into another fund, any insurance cover attached to your old super fund is cancelled. That’s why you must organise transferring your insurance BEFORE consolidating your super and cancelling your old fund. 

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Need to talk about your insurance cover?

If you want to find out more about your insurance cover, give us a call on <<phone number>>, email us on <<email address>> or contact us through <<website address>> and we’ll let you know the next steps.

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“There are some real benefits to keeping insurance cover through your super.”

This information provides an overview only on specific topics and may be limited in scope or subject to qualifications and generalisations. It is provided for your use with insureds and superannuation fund members.

The information provided is also designed to be provided to insureds and superannuation fund members under your own name and any applicable licenses. You will need to consider whether the information is required to be changed or qualified in doing so. To the extent that there is inconsistency between the information on this website and the relevant policy, the policy will take precedence. You should take professional advice and review the appropriateness of the information before it is used by you.

This information does not consider any specific personal needs, objectives, or financial circumstances.

© Zurich Australia Limited ABN 92 000 010 195, AFSL 232510. Information within it is current as at May 2023 but may be subject to change. Updated information will be available by contacting Customer Service on 131 551.