"The group insurance policies through my superannuation tend to be cheaper than the retail policies, but I'm worried that the lower prices come at a trade-off in quality. What are the advantages of the retail policies over group cover?"
- Matthew in Bairnsdale, VIC
Top answer provided by:
Super good question, Matthew and not one enough people ask or even think about.
Amazingly people young or older don’t pay enough attention to their superannuation fund(s) almost like it’s someone else’s money, partly as it’s so far away before they can access, however it is your money and needs to be given the attention and respect it deserves as it can be a very large sum in future.
Apart from: the investment options, the allocation and investment type and the fees your insurance MUST be looked as a priority, even if it is just so you know what you have and whether it’s appropriate or not for you for example life insurance may not be as you don’t have financial dependants however income insurance could be.
As a sweeping statement you are right there is a trade-off of low cost for the insurance vs benefits, features and definitions, however we’ve seen large rate rises for insurance within household name superannuation funds of over 50% per-annum and one very recently for a high 73%.
Another pitfall for this type of insurance is decreasing cover where the older you get the less insurance you have yet the premium remains level, making the premium “appear” cheap, huge problem here is you’ll have a lot less insurance at say age-55 as opposed to age-25 when chances are, you’ll need it most.
We are experts in this space and do it day-in day-out and can provide a comparison to what you have very quickly without cost or obligation.
One added bonus these days is that it’s possible to have tailored retail insurance specific to you and your needs paid for by your superannuation fund(s) and can replace what you currently have to ensure you’re not doubling up, retail products are far more superior in terms of : benefits, features and definitions over default insurance in superannuation fund(s).
Please also refer to this article which gives you the triggers as to when to review your insurance :
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