Insurance in super
Insurance premiums and contributions caps
Contributions that are made to super in order to fund insurance premiums will count toward relevant contributions caps. This includes contributions made to standalone insurance offerings held within a superannuation environment.
Contributions made by an employer, or personal concessional contributions will count toward a member's concessional contributions cap, while after-tax contributions used to fund premiums will count toward a member's non-concessional contributions cap.
Self-insurance generally prohibited from 1 July 2013
Historically, a fund's current or contingent liability to provide death or disability insurance was often provided - at least in part - by the assets of the fund. Since 1 July 2013, super funds have been prohibited from self-insuring, with two exceptions.
Firstly, super funds that self-insure at 1 July 2013 were allowed to continue self-insuring until 1 July 2016. From that date, death or disability benefits could only be provided to members if they are fully supported by an insurance policy.
Secondly, super funds that self-insure at 1 July 2013 are generally be able to continue to self-insure in respect of defined benefit fund members.
Last modified: Wednesday, July 24, 2019