Insurance through super: your employees’ options explained

21 Jun 2022
3 min read

Insurance through super can protect your employees and their loved ones in case the unexpected happens. If they’re ever in a situation where they need to consider making a claim, they might come to you for help to understand what they’re covered for.

Here we explain the key differences between insurance cover in Accumulation 1 and the Defined Benefit Division (DBD) to help clarify what cover your employees may have, and what options are available to them.

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External insurance and inbuilt benefits

One of the biggest differences between Accumulation 1 and the DBD is how cover is provided. Each product’s offering has its own benefits, so it’s important your employees understand what’s available to them, so they can get the cover they need.

External insurance – Accumulation 1 and DBD

UniSuper’s external insurance cover is provided through group insurance policies we’ve taken out with our insurer and is available to both Accumulation 1 and DBD members. Your employees may receive default cover automatically (meaning they receive cover without having to provide evidence of health), or they may elect to receive it. 

Types of external insurance cover

Employees can elect to receive Death and Total and Permanent Disablement (TPD) cover, and Income Protection cover (however as DBD members are provided a temporary incapacity inbuilt benefit they cannot also hold external Income Protection cover). 

Death cover provides a payment if they pass away or have a terminal illness, and TPD cover provides a payment to them if they can’t work due to a permanent disability. Income Protection cover can cover up to 85% of their salary as a monthly payment, which includes up to 10% paid as super contributions, if they can't work because they’re injured or ill.

Learn more about the types of insurance cover.  

Inbuilt benefits – Defined Benefit Division only

As a DBD member, an employee will generally get automatic inbuilt benefits. These are benefits provided by UniSuper and are not insurance (though there are some similar features). Inbuilt benefits can provide financial protection for your employees in case of death, terminal illness or if they can’t work due to illness or injury. External Death and TPD cover is also available.

The value of inbuilt benefits is linked to an employee’s salary, so their level of cover is automatically tailored to them.

From 1 November 2021, Accumulation 1 became the default product for your employees (it was previously the DBD). This means that eligible employees no longer automatically receive inbuilt benefits provided through the DBD. If they’re eligible—receiving 14% or 17% employer contributions—these employees can apply to join the DBD. They should consider all features of the DBD— not just the insurance offering—before choosing to join.

Find out more

Our key differences fact sheet  explains insurance cover in Accumulation 1 and and inbuilt benefits in DBD in more detail.

Workshops for employers

Insurance is a complex topic, but we’re aiming to simplify things for our employer partners, through a workshop covering the different claim types, insurer arrangements and return to work options. Your Employer Partnership Manager can give you more information about running a workshop for you and your people.

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