Insurance premiums to drop for HESTA members

The cost of insurance for most HESTA members is dropping across all cover types by an average of 12%.

From July 1, members will pay less for the same level of death, total and permanent disability (TPD), and income protection cover.

On average, the cost of death cover will drop by 6%, while TPD cover will cost about 15% less. Depending on the benefit period, income protection will reduce by between 1.4% and 23.5%.

The premium reductions will apply for HESTA Super and HESTA Personal Super member; they do not apply to those in corporate super plans.

The reductions follow a renewed group insurance arrangement with AIA Australia and reflect the fund's ongoing commitment to providing value-for-money cover, it said.

HESTA is also enhancing its group insurance offering, waiving insurance fees for members on parental leave for up to 12 months. Where a baby is born before 37 weeks, this can be extended to 24 months.

It will also no longer automatically exclude disabilities related to normal pregnancy, childbirth or miscarriage from its income protection offering in specific circumstances.

"Around 80% of HESTA members are women, many working in health and community services, dedicating themselves to looking after others," HESTA chief executive Debby Blakey said.

"Providing access to appropriate, affordable insurance cover is a critical offering that can give our members and their families real peace of mind at a time when it matters most."

Further, from July 1 members will be able to make non-lapsing binding death benefit nominations, the minimum timeframe for new events cover is reducing from 30 days to 10, and the fund is making it easier for members to apply for increased cover via a short survey about their health.

"For many of our members, the cover they have within their super is likely to be the only personal insurance they hold, which makes getting our insurance offering right all the more important," Blakey said.

"These changes reflect our ongoing commitment to provide insurance cover that is affordable, accessible, and that genuinely works for members when they need it most."

HESTA's decision to reduce premiums comes as many other super funds are increasing theirs significantly in response to increased claims.

AustralianSuper, Cbus and Commonwealth Super Corporation have all increased their premiums, some by more than 40%, in response to a surge in mental health claims.