Why do we have insurance through super?

From investment options to concessional contributions and a multitude of things in between, there are a number of concepts that people tend to find a little confusing about super before they delve in. One of these is life insurance through super – why do we have it?

The answer goes back to the origins of super as a benefit for employees, with employers running dedicated pension schemes for staff. With these schemes tied to employment, insurance was introduced to provide for employees who were unable to work.

Qantas Super, for example, was founded in 1939 as the Qantas Staff Pension Scheme to recognise the contributions employees had made to the company throughout their working lives, by providing for them in retirement in return.

With war declared in Europe soon after the Scheme’s founding, the insurance protections it offered proved to be the saving grace for a number of Qantas employees and their families.

Qantas staff and their dependants weren’t covered by war service benefits or payments, like those provided to merchant sailors.

Instead, the Qantas Staff Pension Scheme provided support to a number of the families of the 17 Qantas staff who died by enemy action or accidents between 1939 and 1945.

While a number of funds offered insurance to members over the years, providing members of default funds with a minimum level of insurance through super became a formal requirement in the mid-2000s, via the Howard Government’s 2005 Choice of Fund reforms.

This requirement was expanded from 2013, with all MySuper products required to include insurance.

As a new member, there are two ways you can get insurance cover from Qantas Super.

To be eligible to receive Basic Cover, you must be 25 or above and your super balance with us must be $6,000 or more. When you meet the criteria, we’ll automatically apply this cover to your account, based on your Salary for Insurance Purposes. Limited Cover will initially apply until you’ve been At Work for 60 consecutive days.

You can also obtain Basic Cover sooner by opting in to receive it. Limited Cover will apply until you’ve been At Work for 60 consecutive days.

Yes! In the 12 months to 30 June 2020, the industry average of claims accepted by super funds was 98.1 per cent for death cover claims, while 90.8 per cent of claims for TPD cover were accepted over the same period.

Depending on your circumstances, you may find that your insurance needs are higher than the amount of Basic Cover provided to you automatically. If this is the case, you may want to learn more about applying for Voluntary Cover.

You may be eligible to apply for Voluntary Cover up to $750,000 for death or death and TPD without providing evidence of good health (in other words, going through an underwriting process). If you require more cover, you can apply for amounts above $750,000 by going through underwriting. Your application will be assessed by our insurer.