That's life (insurance)!

Just like car insurance, people take out life insurance in the hope they’ll never need to claim on it.

But it’s good to know it’s there if you need it.

In Australia, we are typically underinsured when it comes to life insurance. 

And it’s not by a small amount. Rice Warner Actuaries estimate that the typical Australian family with two children require insurance for $680,000 rather than the $258,000 they’re typically insured for.*

At VicSuper, members who join through their employer generally receive automatic insurance cover if they are aged 14 to 69 (inclusive), legally permitted to reside and work for reward in Australia, and meet all other eligibility requirements. 

Members who don’t join through their employer do not receive cover automatically but may be able to apply (subject to the Insurer’s approval). 

You can check your VicSuper Benefit Statement to see if you have cover through VicSuper (subject to meeting all the eligibility requirements). If you do, your statement will also show the level of cover you have.

VicSuper provides 3 different types of insurance cover:

1. Death only cover
   Exactly as it implies, Death only cover, provides your family with some financial support if you die. 
2. Death and total and permanent disablement (TPD) cover
   Designed to assist you and your family if you die or become permanently disabled and are unlikely to ever be able to work again. 
3. Income protection
   Provides an income if you are affected by an injury or illness that impacts on your earnings.** 

Full details on policy definitions are outlined in the VicSuper Insurance Handbook

Getting extra cover

When life changes, your insurance needs may change too.

Insurance through VicSuper comes with Life events cover. Under Life events cover, members may be able to apply to increase their insured level of death only, or death and TPD cover when certain events take place in their lives, such as marriage, divorce, birth of a child or purchase of a home.

You need to satisfy the eligibility requirements to take advantage of Life events cover, so we encourage you to give us a call to speak to us about it.

If there’s no major life event on the horizon and you just feel you need a higher level of cover for Death and TPD, you may be able to increase it by applying (subject to the Insurers’ approval).

Reducing or cancelling cover

Reducing or cancelling your cover is often pretty straightforward. You can find out more on our website.

Waiting periods

It’s important to know that waiting periods are likely to apply for insurance through VicSuper. You should check the Insurance Handbook or speak to us if you’re thinking about claiming or want to know more about waiting periods.

The amount and type of cover that’s right for you will depend on your circumstances.

Here are some considerations to get you started.

Time – What do you earn now and how long would you and your loved ones need financial assistance if something were to happen to you?

To repay debts and maintain current living standards following the death of a partner, Rice Warner Actuaries estimate that a couple in their 40s with children need cover for at least 10 years of income for the higher-earning partner.*

Debts - Do you have a mortgage or other debts that would still need to be paid if something happened to you?

Dependants - Do you have children or other dependants? Have you factored in education, additional childcare that may be required if something were to happen to you?

Spouse – If you have a spouse, have you looked at their insurance arrangements? Even if your spouse is not currently working, would you need to cover additional costs (eg childcare) or future earnings if something were to happen to them? While people who are not working may not eligible for certain types of cover through VicSuper, it may be worth investigating some options if this applies to you.

Our financial planners can help you consider your insurance needs through VicSuper. Most of the time, this can be done quickly over the phone at no additional cost.

Most people are aware that their cover will lapse if they cancel it, no longer meet the eligibility requirements or close their VicSuper account. However, many are unaware that their cover may also lapse if they:

• don’t have enough funds in their VicSuper account to cover the premiums
• are unemployed for more than 12 months (applies income protection cover)
• take unpaid leave, including parental leave, for longer than the agreed period of time (varies depending on the type of insurance)
• go overseas, even if you’re there to work for your employer, for longer than the agreed period of time (varies depending on the type of insurance)
• have already had a benefit paid
• make a fraudulent claim.

Check the VicSuper Insurance handbook to make sure you understand the conditions.

If you are unemployed, or planning to take extended leave or go overseas, we recommend contacting us to ensure your understand any insurance implications.

Along with our Insurer, VicSuper aims to process all insurance claims as quickly as possible, but it can be a lengthy process.

As a general rule, you should contact our Member Centre on 1300 366 216 to start the ball rolling as soon as possible.

Our consultants will discuss your situation with you and guide you through the appropriate process. They’ll also advise you of any details required from you (eg medical evidence) in order to progress your claim.

We’re here to help you get the most out of your VicSuper membership.

To find out more about insurance through VicSuper or how we can help you work out an appropriate level of cover for you, call us on 1300 366 216.

Insurance cover through VicSuper is provided under group life insurance and group salary continuance policies issued and underwritten by the National Mutual Life Association of Australasia Limited trading as AMP (the Insurer) ABN 72 004 020 437. Australian Financial Services Licence No. 234 649.  

* Source: ricewarner.com/addressing-superannuation-underinsurance
** Income Protection is limited to those under age 65. A waiting period and maximum benefit period generally apply.