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AustralianSuper Announces Significant Insurance Premium Increases

Understanding the Impact of Rising Claims on Superannuation Insurance Costs

AustralianSuper Announces Significant Insurance Premium Increases?w=400

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

AustralianSuper, one of Australia's largest superannuation funds, has announced substantial increases in insurance premiums, effective June 2026.
This decision affects approximately 1.7 million members and is primarily driven by a notable rise in mental health and disability claims.

The fund has detailed the following average annual premium increases across different cover types:

  • Total and Permanent Disability (TPD) cover: 40% increase
  • Death cover: 20% increase
  • Two-year income protection: 38% increase

These adjustments mark a reversal of the downward trend in insurance costs observed over the past three years. AustralianSuper attributes the premium hikes to a surge in mental health and disability claims, particularly among younger members who have been unable to return to work. The value of mental health claims has escalated from $1.2 billion in 2019 to $2.4 billion in 2024, placing significant pressure on the cost of coverage.

Christine Cupitt, CEO of the Council of Australian Life Insurers, highlighted the broader industry challenge, stating that the sustained growth in mental health claims is placing real pressure on the affordability and sustainability of cover across the system. She noted that the sector is witnessing consistent year-on-year increases in claims, with a growing number of people, particularly younger Australians, becoming permanently unable to work due to mental health conditions.

For AustralianSuper members, the impact of these increases will vary based on occupational categories. For instance, a 45-year-old member in a white-collar job will see their basic cover premium rise to $236 annually, while a member of the same age in a blue-collar job will pay $526 per year. Despite these increases, AustralianSuper maintains that its insurance rates remain below 2022 levels, following previous premium reductions over the past three years.

The fund's insurer, TAL, has been recognised for its efficiency in claims processing, with one of the highest proportions of claims paid, the quickest approval times, and the lowest rates of dispute in the superannuation industry for the year ending June 2025. TAL emphasised its commitment to working with super funds to keep premiums sustainable, noting that in the previous year, more AustralianSuper members relied on this important safety net than ever before, with over 12,000 members and their families receiving over $700 million to support them through loss, injury, and illness.

These developments underscore the importance for policyholders to stay informed about changes in their insurance coverage and to assess how such adjustments may affect their financial planning. Members are encouraged to review their insurance needs and consider seeking professional advice to ensure their coverage aligns with their personal circumstances and financial goals.

Published:Friday, 24th Apr 2026
Author: Paige Estritori

Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.

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Knowledgebase
Double Indemnity:
A clause or provision in a life insurance policy that doubles the payout in cases of accidental death.