Almost half the population do not have a proper understanding of insurance within their super, especially generation Y (under 32).
Research commissioned by the Association of Superannuation Funds of Australia (ASFA) showed 40 per cent do not understand insurance, with males having twice the understanding than females.
ASFA was most concerned that one in five (21.6 per cent) of generation Y said they had no understanding at all, while 50 per cent said they had no understanding or that their understanding was poor or very poor.
“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 “while there’s no substitute for good advice”, people should ask questions to their superannuation fund or their financial adviser 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”.