Best of the Best 2023: Best-Value Insurance in Super
Almost 10 million Australians have at least one type of insurance through their superannuation, and it can be surprising how often they rely on it.
A report by the industry body ASFA found that in 2021, almost 50,000 claims were made on a variety of super-based insurance policies spanning life cover, total and permanent disability (TPD) and income protection.
According to ASFA, insurance held through super offers plenty of value for members, including:
• A relatively high average payout ratio;
• Affordable premiums;
• A tax-effective way for members to access personal insurance.
Despite the benefits, about one in two Australians is in the dark about how much insurance they have in place through their super. One in four isn't clear if they have cover at all. This makes it worth contacting your fund to get an idea of the insurance you have in place (if any) because none of us know when we might need it.
Insurance through super is low cost, but it's not free. The premiums come out of your super balance, and this highlights the need for cover that offers good value because high premiums can eat into your final savings on retirement.
After being a runner-up last year, Virgin Money Super is on top of this year's leaderboard. "Virgin Money Super offers simple, good value insurance to help our customers protect what matters, with premiums paid conveniently from a customer's super account," says Christopher Sozou, general manager of Virgin Money Super.
"We are able to deliver very competitively priced automatic death and total and permanent disability insurance thanks to the power of our group life insurance arrangement.
"Our customers like the convenience of receiving our default insurance without needing to apply or provide health and medical checks."
Virgin Super also offers the flexibility for fund members to tailor or increase their automatic insurance, "This becomes important at different life stages such as getting married, starting a family or taking out a new mortgage," says Sozou.
Of course, super is not just about insurance. According to Sozou, Virgin Money Super has some of the lowest fees in the market as well having introduced a few industry firsts.
"We have led the industry to be the first super fund in Australia to reduce fees for parents on maternity leave or paternity leave," he says. "The Virgin Money Super Baby Break is a discount on the asset-based admin fee - from 0.394% to 0.044%. That's a saving of $175 on a $50,000 balance."
Along with good value insurance, Virgin Money Super is the only super fund in Australia to reward members with Velocity points (the frequent flyer program of Virgin Australia). For every $5 you contribute to your super account, Virgin Money
will reward you with one Velocity point.
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