Gen-Y, women “in the dark” on insurance within super

There is a deep lack of understanding of insurance within superannuation among Generation Y (below 32), the Association of Superannuation Funds of Australia (ASFA) said.

ASFA commissioned research that showed one in five (21.6 per cent) of Generation Y reported no understanding at all, while 50 per cent of respondents said they had no understanding or poor or very poor understanding.

The research also found over 40 per cent of the population do not understand insurance within their super, while around 40 per cent said they do not know how to choose or change their level or type of cover.

Males are twice as likely to say they have a very good understanding about their insurance compared to females, while almost half of all females were unsure about how to choose or change their level of cover.

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"Many people remain in the dark about what type of cover they have and whether it's a good fit for themselves and their family," ASFA CEO Pauline Vamos said.

"This is why it's so important to take the time to get to know your insurance cover, and ask the right questions to help you make a choice about what type and level of cover is right for you."

Twelve per cent of females surveyed said they had no understanding at all of the insurance options available through super, while 13.3 per cent of pre-baby boomers (68 and above) had no understanding.

Almost 40 per cent of those surveyed said they do not know how to choose or change their level or type of cover, with 46.8 per cent of females unsure of how to do it.

Vamos said people should ask questions to their superannuation fund such as what type of insurance they have at the moment, how much their family will get if they die, and who decides where there super will go if they die.