Employers supplying a default Superannuation Fund for employees who do not utilise the "choice of super fund" regulation being released on the 1st July 2005, will be required to offer a superfund with a minimum level of death cover at a premium of at least $0.50 per week or on an age-based benefit level as follows:
| Age |
Level of insurance cover |
| 20 to 34 |
$50,000 |
| 35 to 39 |
$35,000 |
| 40 to 44 |
$20,000 |
| 45 to 49 |
$14,000 |
| 50 to 55 |
$7,000 |
| 56 or more |
Nil |
Defined benefit schemes will meet the insurance requirements where they provide a death benefit with a future service component at least equal to the dollar levels of cover shown above.
Importantly, it is the employees decision whether or not to accept insurance cover. Some of the exemptions to this regulation that apply are:
- If an employer cannot obtain insurance for an employee due to the employee's health, occupation (eg high risk occupation such as underground miners), hours worked (eg casual worker) or other circumstances determined by an insurer, then no minimum insurance is necessary. The employer is not expected to enquire with another fund for coverage for these employees.
- If the employees superannuation death benefit (member balance), is at least $50,000 and above, the minimum insurance requirement does not apply.
If your default superannuation fund is not supplying life insurance, please contact our office admin@mt.com.au and we will discuss your options.
