Most working Australians already hold life and disability insurance and don’t know the detail — because it came automatically with their super. That “default” cover is convenient, but it works very differently to a policy you apply for and are medically underwritten on. The difference can decide whether a claim is paid.
Default (automatic) cover
- No health questions — you’re accepted automatically when you join an eligible fund.
- Usually Life and TPD, sometimes basic income protection, at a set default level.
- Cheaper-looking, but the amount is often well below what a family actually needs.
- Can carry exclusions and restricted terms — e.g. limited cover for pre-existing conditions, or “New Events” cover only until you’ve been actively at work for a period.
Medically underwritten cover
- You apply and disclose your health; the insurer assesses you and sets terms up front.
- Once accepted, the cover is locked in — the insurer has already assessed the risk, so there’s far less room to dispute a future claim.
- You choose the amount and features to match your situation, not a one-size default.
- Premiums reflect your health and age — healthy applicants often pay less than they’d expect.
Which is right for you?
Default cover is a sensible safety net and better than nothing. But if you have dependants, a mortgage, or any health history worth getting assessed properly, underwritten cover gives you certainty about what you’re actually covered for. Many people hold a base of default cover and top up with an underwritten policy for the gap.
Frequently asked questions
Is default insurance in super any good?
It’s a useful automatic safety net, but the default amount is often too low and it can carry exclusions or restricted terms that only surface at claim time. It suits people with simple needs; those with dependants or a mortgage usually need more.
What does medically underwritten mean?
It means the insurer assessed your health and history when you applied and set your terms then. Because the risk was assessed up front, an underwritten policy is generally much harder to dispute at claim time.
Can I be declined for underwritten cover?
You can be offered cover with a loading (higher premium), an exclusion, or in some cases declined - but you find that out up front, not at claim time. A review helps you understand your options before you apply.
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