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Life insurers caught selling ‘junk’ insurance through super

Life insurers have been found to be selling junk insurance in the form of permanent disability products through superannuation funds.

The Australian Securities and Investments Commission found almost half a million people were paying for a type of total and permanent disability insurance through their super fund that would only be paid out in the most “catastrophic” circumstances.

ASIC Commissioner Sean Hughes tells Ross Greenwood 60 per cent of claims for this insurance were declined.

“Unless they could not feed, or wash, or clothe themselves, the insurer decided that they had not met the tests to total and permanent disability.

“Go home, check the cover you’ve got with your super fund.”

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Image: Getty/Parinda Yatha/EyeEm