An annual superannuation statement rarely gets more than a glance, but the insurance section of that letter can carry a quiet surprise for anyone approaching 65 or 70. Tucked inside most super accounts is a life insurance policy the member never applied for, and it comes with a built-in use-by date that many people only discover once it has already passed.
Understanding how that cover works, and when it changes, means an older Australian can check their own statement with clear eyes rather than assume the policy they have held for years still applies in full.
What does a super fund automatically provide?
Most super funds, other than self-managed super funds, bundle in three possible types of insurance: life cover, total and permanent disability (TPD) cover, and income protection. Members aged 25 and over are generally given life and TPD cover automatically, for a set default amount, without needing to complete a medical check, according to the Australian Government’s MoneySmart website.
That is why so many people hold a policy they never consciously chose. It arrived as part of the fund’s standard settings, not as the result of an application.
When does cover inside super actually stop?
The two types of cover do not end at the same age. Life cover held inside super usually stops at age 70, while TPD cover inside the same fund usually ends at 65, MoneySmart says. Both are standard industry settings rather than a single fixed calendar date, and individual funds can vary the age, so the fund’s own product disclosure statement confirms the exact figure that applies to a particular account.
That gap matters. A member can turn 65, lose TPD cover through their fund, and still carry a life policy through the same account for another five years without realising the two have parted ways.
Does buying outside super change the picture?
Life insurance bought directly, outside a super fund, can continue past 65 for as long as the premiums keep being paid. TPD cover bought outside super, however, still usually ends at 65 regardless of where it sits, MoneySmart notes. Comparing a policy held through super against one bought directly is therefore not simply a comparison of price. It is a comparison of two different age limits attached to two different products.
TruStage, which markets policies to older applicants, frames the shift this way: “After the age of 65, your personal insurance needs, family responsibilities, and budget may change.”
Term life or whole life – what changes with age?
Term life insurance covers a set period and generally carries lower premiums, but some term policies are not renewable past a certain age, and some insurers decline to offer new term cover to applicants once they pass a set age threshold. Whole life insurance is built to run for as long as premiums are paid, with no term limit, but it is generally more expensive than term cover for the same age and amount insured.
Fidelity Life material points out that the traditional case for life insurance has often already moved on by this stage of life, since some people in their 60s and 70s have cleared the debts the cover was originally bought to protect against: “raising kids, paying a mortgage, or paying for college.”
What about policies with no medical exam?
A separate category of guaranteed-acceptance, or simplified-issue, policy is marketed specifically to older applicants, with no medical exam and no health questions. Providers in this space advertise entry ages running from 50 to 85. These policies are typically sold in smaller coverage units aimed at final-expense costs, a structurally different product to a standard term or whole life policy with a larger sum insured.
What if the super account stops being used?
Insurance held through super can also be affected by rules around account inactivity, depending on the individual fund. If a linked account stops receiving contributions, cover can lapse under those rules, MoneySmart says, which means a policy a member has relied on for years can stop applying without a specific letter announcing it.
Checking the current type, amount and end-age of cover is a matter of reading the fund’s annual statement or logging into the member portal, where this detail is set out in full. Funds can also confirm current cover status directly on request, and MoneySmart’s insurance-through-super guidance sets out what to look for line by line. Services Australia and the MoneySmart website carry the current age thresholds and definitions that apply to a specific fund or policy, since individual funds can set their own variations.
None of this turns on a single rule that fits every account. What it offers instead is the chance to read a familiar statement with a sharper eye, and to know precisely which cover still applies, which has quietly ended, and which questions are worth putting to the fund directly.
