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Super & retiring / Essential Super / Understanding insurance

Benefits of having insurance in your super 

There are some good reasons to have insurance in your super.

Some of these can include lower premiums and easier budgeting. 

It makes managing your insurance easier 

Firstly, your premiums are automatically deducted from your super rather than out of your after-tax salary or wages.

This can make it easier to manage your day-to-day budgeting. Also, you can manage your insurance and your super in the one place. 

Better tax outcomes 

Paying for insurance through your super may be tax-effective, but this depends on your personal circumstances (e.g. your marginal tax rate and the type and amount of contributions you make to super).

We work with insurers for lower premiums and improved terms and conditions

Generally, your premium will be lower than the amount you would pay for a non-super insurance policy.

Super funds can negotiate lower group rates with the insurer, which is usually for a group of members in a fund. Keeping premiums low means more money stays in your super – where it belongs.

You will need to consider your level of cover and the impact of premiums on your account balance. If these payments aren’t offset by regular super contributions, rollovers or investment returns, it will reduce your account balance.   

Consider your insurance needs 

  • Depending on your circumstances, you may have more cover than you need or not enough cover.

    You can increase, reduce or cancel your insurance at any time, but if you want to increase your cover, you will need to apply. The insurer may accept or decline your application.

    It’s a good idea to do your research or speak to a financial adviser. 

    There are many tools and sources of information you can use. Moneysmart has a good summary on how life insurance works, while the life insurance calculator can help figure out: 

    • If you need cover 
    • How much cover you might need

What types of insurance cover are available under Essential Super?

  • Death cover

    Also known as life cover, may pay a lump sum benefit if you pass away or become terminally ill.

    Total Permanent Disablement (TPD) cover

    May pay a lump sum benefit if you’re totally and permanently disabled by injury or illness and unlikely to ever work again.

    Salary Continuance Insurance (SCI) cover

    Also known as income protection, may pay a monthly benefit if you’re totally disabled or partially disabled and unable to work for an extended period of time due to illness or injury.

    Essential Super has two categories of cover available: 

    • Lifestage cover: is automatic default cover that is provided to eligible members and includes a level of Death and Total and Permanent Disablement (TPD) cover based on your age and changes as you move into each new age bracket. Lifestage default cover is automatically provided when you reach age 25 and your account balance reaches $6,000.
    • Tailored cover: is cover that eligible members can apply for and may include a fixed amount of Death, Total and Permanent Disablement (TPD) and Salary Continuance Insurance (SCI) cover. Cover is subject to the insurer’s acceptance. Tailored cover allows you to apply for the type and amount of cover that is right for you.

    Read the Essential Super Product Disclosure Statement (PDS), Essential Super Insurance in Super Key Facts Sheet and Insurance Reference Guide for eligibility criteria and more information.

Cost of cover

How do I know which level of cover I have? 

  • There are a few ways you can check your level of cover or premium amount. 

    • Log on to NetBank or the CommBank app
    • Check the insurance section of your latest super statement 
    • Call us on 13 4074, Monday to Friday, 8:30am - 6pm (Sydney time)

    The type and level of cover and premiums you pay may vary depending on whether you have previously held insurance cover or advised us to increase, reduce or cancel your insurance. You can read more about your level of cover and how your premiums are calculated by reading the Essential Super Insurance Reference Guide.

How to review your insurance 

  • 1. Find all the insurance cover you have inside or outside your super (with us and elsewhere) and identify:

    • the type of cover
    • the level of cover
    • the amount you’re paying

    2. Review your insurance so you can determine whether it still meets your needs.

    Speak to a financial adviser if you need help to work out what insurance cover is right for you.  

    Things to consider:

    • Know the differences between holding insurance inside or outside your super
    • Determine if your needs have changed since you took out your current insurance
    • Consider if your insurance meets your needs.
    • If you plan to switch insurance providers;
    • be aware of the impacts of losing any existing benefits and waiting periods (if applicable)
    • you should ensure the replacement cover is in place before cancelling your existing cover
    • and if you retain duplicate cover you may be unable to claim on multiple insurance covers (depending on the terms of your policies)

    For general information about insurance in super please read the Essential Super Reference Guide  or visit Moneysmart. 

When does my cover in super end? 

  • Insurance in your super may end if:

    • You reach the age that cover ends
    • Your super account hasn’t received any money for 16 continuous months unless you tell us you want to keep your cover in these circumstances
    • You don’t pay the full premium within the required period
    • You're no longer a member of the fund
    • You withdraw your whole super account balance
    • You become a lost member and your account is sent to the ATO. Keep your contact details up to date with your fund if you want to avoid this

Where can I find more information about insurance? 

    • Use our online tools
      View your insurance details online at any time by logging in to NetBank and selecting your Essential Super Account or through the CommBank app.
    • ATO Online
      You can also view and consolidate multiple super accounts that you may have on ATO Online. Before consolidating any super accounts we recommend you consider or seek advice about the impact it might have on your insurance cover and your super benefits.
    • Your insurance acceptance, confirmation letter or certificate
      This is the letter you received when your cover commenced. It will show you any non-standard exclusions that apply to your cover.
    • Product Disclosure Statement and Insurance Reference Guide
      You can view the Product Disclosure Statement and Insurance Reference Guide online. They include general information about your insurance cover. 
    • MoneySmart website
      MoneySmart includes general information about insurance in super.
    • Speak to a financial adviser
      If you have questions about your insurance cover in your super account a financial adviser can help you work out what insurance cover is right for you.  

Things you should know:

  • 1 You need to be aged 25 or older, but under the age of 65 with a balance of $6,000 or more, to receive Death and Total and Permanent Disability (TPD) cover automatically. Please see the PDS and Insurance Reference Guide for specific terms that apply to insurance cover in Essential Super, including what’s not covered. For at least the first two years of your cover, you generally won’t be paid a benefit if it is due to a pre-existing condition. Generally, a pre-existing condition is an illness or injury that you were aware of at any time before your cover commenced or increase. This exclusion will no longer apply if you're capable of working for 30 consecutive days either immediately before the two year period ends or at any time after the two year period ends. Additional exclusions also apply.

    Avanteos Investments Limited ABN 20 096 259 979, AFSL 245531 (referred to as Colonial First State, CFS, ‘we’, ‘us’ or ‘our’) is the Trustee of Essential Super ABN 56 601 925 435 and the issuer of interests in Essential Super. Essential Super is distributed by the Commonwealth Bank of Australia ABN 48 123 123 124, AFSL 234945 (the Bank). The CFS Group consists of Superannuation and Investments HoldCo Pty Limited ABN 64 644 660 882 (HoldCo) and its subsidiaries, which includes CFS. The Bank holds an interest in the CFS Group through its significant minority interest in HoldCo.

    This information is issued by CFS and may include general financial product advice but does not consider your individual objectives, financial situation, needs or tax circumstances, and so you should consider the appropriateness of the advice having regard to your circumstances before acting on it. The Target Market Determination (TMD) for Essential Super can be found at cfs.com.au/tmd and includes a description of who the financial product is appropriate for and any conditions on how the product can be distributed to customers. You should read the Product Disclosure Statement (PDS) and the Reference Guides for Essential Super carefully and consider whether the information is appropriate for you before making any decision regarding this product. Download the PDS and Reference Guides at commbank.com.au/essentialsuper-documents or call us on 13 4074 for a copy. 

    None of the Bank, HoldCo, CFS, nor any of their respective subsidiaries guarantee the performance of Essential Super or the repayment of capital by Essential Super. An investment in this product is subject to risk, loss of income and capital invested. An investment in Essential Super is via a superannuation trust and is therefore not an investment in, deposit with or other liability of the Bank or its subsidiaries. 

    The insurance provider is AIA Australia Limited ABN 79 004 837 861, AFSL 230043 (AIA Australia). AIA Australia is not part of the Commonwealth Bank Group or CFS. Insurance cover is provided to eligible members of Essential Super under policies issued to CFS.

    Any information provided by CBA may include general financial product advice but does not consider your individual objectives, financial situation, needs or tax circumstances, and so you should consider the appropriateness of the advice having regard to your circumstances before acting on it.  You should read the PDS and the Reference Guides for Essential Super carefully and consider whether the information is appropriate for you before making any decision regarding this product.