Under 25 or a Low Super Balance? Why You Likely Have No Default Insurance

Written by Christopher Hall, AdvDipFP | Authorised Representative, AFSL 526688 | July 2026

If you are under 25, or your super balance is under $6,000, your fund generally does not give you automatic life, TPD or income protection cover — the default insurance most Australians assume comes with super is switched off for you unless you opt in. This has been the rule since 1 April 2020 under the Putting Members' Interests First reforms (APRA, 2020). It matters more than it sounds: from more than 500 policy reviews, Christopher Hall, AdvDipFP, Authorised Representative, AFSL 526688, has found that the proportion of insurance applications accepted on standard terms has inverted over the past decade — the healthiest, cheapest time to secure cover is earlier than most people act.

This article is general information, not personal advice; whether cover suits you depends on your circumstances and should be confirmed with a licensed adviser. What follows explains what the reforms changed, why waiting can quietly cost you access to cover, and how to check what you have.

Do under-25s get automatic insurance in super?

Generally, no. Since the Putting Members' Interests First reforms, super funds must provide insurance to new members under 25 only if the member opts in — it is no longer added automatically (APRA, 2020). The same opt-in rule applies to any member whose account balance is under $6,000. There are limited exceptions (for example, some funds in dangerous occupations), but for most young Australians the starting position is: no cover unless you ask for it.

That is a deliberate consumer protection — it stops small or inactive balances being eroded by premiums for cover a young member may not need. The trade-off is that a member who assumes they are covered may have nothing at all.

What did the Putting Members' Interests First reform change?

The reform (effective 1 April 2020) stopped funds providing insurance on an opt-out basis to two groups: new members under 25, and members with a balance under $6,000 (APRA, 2020). Before it, most default cover was switched on automatically; after it, those two groups must actively elect to have it. An election, once made, generally continues until the member changes it.

The reverse is where people get caught. Not opting in at the start is easy — but opting in later is often not. In Christopher Hall's experience, a member who went without default cover and later tries to join the group policy is frequently not accepted automatically and is instead put through full individual underwriting. If their health has changed in the meantime, that can mean more expensive and narrower cover than the default they passed up (C. Hall, Arrow Equities, 500+ policy reviews). So the decision to skip cover early is rarely as reversible as it looks — which is exactly why it is worth checking your position with a licensed adviser before you rely on being able to "turn it on later". You can book a quick review with an adviser here.

It sits alongside the earlier Protecting Your Super changes, which cancel insurance on accounts left inactive for 16 months — together they are why default cover in super is far less universal than it used to be. The wider consequences of these reforms are covered in what the super insurance reforms did to Australians' cover, and the question of whether default cover is adequate for those who do have it is covered in is your default cover in super actually enough.

Does this only affect under-25s — or Australians up to about 31 now?

It reaches further than today's under-25s. The rule has been in force since 1 April 2020 — more than six years. The simple maths is telling: someone who was 25 when it began is around 31 today (25 + roughly six years since April 2020 ≈ 31). So the group who moved through their early working years under this opt-in regime now stretches from current under-25s up to Australians in their early thirties.

Turning 25 does not automatically fix it. Default cover can switch on once a member is 25 and holds at least $6,000, but in practice many in this cohort still have gaps — balances that stayed under $6,000, accounts left inactive and cancelled after 16 months, multiple accounts, or simply never opting in. In Christopher Hall's reviews, a meaningful share of people now in their late twenties and early thirties discover that cover they assumed existed was never switched on (C. Hall, Arrow Equities, 500+ policy reviews). If you are anywhere in that age band, it is worth checking rather than assuming.

What is the "insurable window" and why does it close?

The insurable window is the period in life when you can obtain cover on standard terms — before medical markers accumulate. It closes gradually because Australia's healthcare system is very good at early detection: routine blood tests, scans and specialist referrals surface possibilities that, from an underwriter's perspective, are signals of elevated claim risk — even when no disease is present.

Christopher Hall describes the shift bluntly: "A smaller amount of cover held on clean terms at age 28 is materially more valuable than a larger amount applied for at age 44 with three medical markers on file." His review base shows the market has inverted — a decade ago most applications proceeded without exclusions or loadings; today only a minority do (C. Hall, Arrow Equities, 500+ policy reviews). This is also why applications are getting harder to get approved on standard terms.

Is it worth getting life insurance in your 20s or 30s?

For many young Australians the value is less about a large payout and more about locking in access and price. Premiums are lowest at younger ages, and cover secured while health is clean avoids the exclusions, loadings or declines that can follow once markers are on file. Once a person carries more than about three exclusions or loadings, insurers frequently decline TPD and income protection entirely (C. Hall, Arrow Equities, 500+ policy reviews) — the products that matter most to a working person.

One feature worth knowing about is future insurability (offered by some insurers, sometimes called a guaranteed or future insurability option). It lets a younger, healthy person lock in the right to increase their cover later — at life events such as taking on or increasing a mortgage, or a growing family — without fresh medical underwriting. In other words, a healthy 28-year-old can plan ahead and expand cover at those trigger points on the more favourable terms and pricing of their younger, healthier self, rather than being re-assessed years later and possibly loaded or declined. Availability and conditions vary by insurer, which is part of what a review compares.

Whether that value applies to you depends on your income, debts, dependants and health, so this is general information, not personal advice — the way to know is to have your situation reviewed by a licensed adviser before you decide. You can book a quick review with an adviser here. The related point that engaging with advice earlier tends to pay off applies squarely to cover.

How do you opt in to insurance inside super?

If you are under 25 or under the $6,000 balance threshold and want cover, you generally elect it directly with your fund — through its member portal, app, or by contacting the fund — and the election continues until you change it (APRA, 2020). It is worth confirming the type and amount you are electing (life, TPD, income protection; the sum insured; and the definitions) rather than assuming the default settings suit you.

It is also worth confirming whether you could be added to the group (default) policy later if you don't opt in now — as above, that route is often not available, so opting in while you can, or arranging cover with an adviser, may be the more reliable path. Because the right amount and structure — and whether cover belongs inside super, personally, or both — depend on your circumstances, this is general information, not personal advice; a licensed adviser can help you set it up correctly the first time. You can start with a review here.

What does cover cost for a young Australian?

Cost depends on age, occupation, cover type, sum insured and health — and premiums for younger, healthier applicants are typically the lowest they will ever be. Rather than quote figures that vary by insurer and profile, it helps to see how cost is built up for a real occupation: our worked examples for an electrician and a nurse show how age, occupation and cover type drive the premium. Real reviews show the same forces later in life, too — the case studies of a registered nurse and a carpenter show what a structured review can change once cover has been in place for years.

For a young family, the separate question is whether any default cover held is enough — default sums insured are often modest. A structured insurance premium and policy review checks what default insurance in super you hold (if any), whether it suits your stage of life, and what it would cost to secure appropriate cover while you are young — comparing a panel of leading Australian insurers including OnePath, MetLife and PPS, among others.

Frequently asked questions

Do you get life insurance automatically in super under 25?

Generally no. Since 1 April 2020, super funds provide insurance to new members under 25 only if the member opts in — it is not added automatically (APRA, 2020). The same opt-in rule applies to members with a balance under $6,000. Limited exceptions exist, such as some dangerous-occupation arrangements.

What is the $6,000 super insurance rule?

Under the Putting Members' Interests First reforms, super funds must not provide insurance on an opt-out basis to members whose account balance is under $6,000; those members must opt in to have cover (APRA, 2020). It is designed to stop small balances being eroded by premiums for cover the member may not need.

Should a 25-year-old get life insurance?

It depends on their income, debts, dependants and health. For many, the value at that age is locking in access and a low premium while their health is clean, rather than a large payout. Because it varies by person, it is general information only — a licensed adviser can assess whether cover is worthwhile for an individual's situation.

Is it cheaper to get life insurance when you're young?

Premiums are generally lowest at younger ages, and cover secured while health is clean avoids the loadings, exclusions or declines that can follow once medical markers accumulate. Christopher Hall's reviews show the proportion of applications accepted on standard terms has fallen sharply over the past decade, which makes acting earlier more valuable.

What is the insurable window?

The insurable window is the period when a person can obtain cover on standard terms, before medical markers accumulate. It narrows over time because routine screening surfaces possibilities that underwriters treat as elevated risk, even without a diagnosis. Securing cover earlier increases the chance of standard terms and a lower premium.

Can I be declined for TPD or income protection because of past health issues?

Yes. Insurers assess medical history at application, and past conditions, investigations or specialist referrals can lead to exclusions, loadings or a decline. Christopher Hall's review base indicates that once a person carries more than about three exclusions or loadings, TPD and income protection are frequently declined altogether, even if no active disease is present.

How do I turn on insurance in my super fund?

You generally elect cover directly with your fund — through its member portal, app or by contacting it — and the election continues until you change it (APRA, 2020). It is worth confirming the cover type, sum insured and definitions rather than accepting default settings unchecked.

Is default super insurance enough for a young family?

Often not. Where default cover exists, the sums insured are frequently modest relative to a mortgage and dependants, and definitions may be narrower than a retail policy. Whether it is enough depends on the family's debts, income and needs, which is what a policy review assesses.

What is Putting Members' Interests First?

It is a 2019 reform (effective 1 April 2020) that stopped super funds providing insurance on an opt-out basis to new members under 25 and to members with balances under $6,000 (APRA, 2020). The aim was to protect small and young balances from being eroded by premiums for cover the member may not need.

Does changing jobs cancel my super insurance?

Changing jobs can leave your old super account inactive, and insurance on an account left inactive for 16 months can be cancelled under the Protecting Your Super rules. Starting a new fund may also mean new default cover is not switched on automatically if you are under 25 or under the balance threshold. It is worth checking cover whenever you change jobs or funds.

How many medical conditions before insurers decline cover?

There is no fixed number, but Christopher Hall's reviews indicate that once a person carries more than about three exclusions or loadings, insurers frequently decline TPD and income protection cover, though life and trauma cover may still be available depending on the conditions. This is a pattern from his review base, not a formal industry rule.

Can I add default insurance to my super later if I didn't opt in?

Often not automatically. In Christopher Hall's experience, a member who went without default cover and later tries to join the group policy is frequently required to go through full individual underwriting rather than simply being added. If health has changed, that can mean more expensive or narrower cover than the default originally available, which is why skipping cover early is rarely as reversible as it seems.

What is a future insurability option?

Future insurability (offered by some insurers) is a feature that lets a policyholder increase their cover later at defined life events — such as a mortgage or a growing family — without new medical underwriting. It allows a younger, healthy person to lock in terms now and expand cover at those triggers on the pricing and conditions of their earlier, healthier self. Availability and conditions vary by insurer.

Book a quick review with an adviser

Book a quick review with an adviser now. A review checks whether you have any default insurance in super, whether it suits your stage of life, and what it would cost to secure appropriate cover while you are young and healthy. This is general information, not personal advice.

Find out if you're eligible →

About the author

Christopher Hall, AdvDipFP, is the principal financial adviser at Arrow Equities and an Authorised Representative under AFSL 526688. He has completed more than 500 life insurance policy reviews for Australian families, with a specialisation in life risk insurance.

Sources

#	Source	Type	Year
1	Australian Prudential Regulation Authority (APRA) — Putting Members' Interests First: frequently asked questions (opt-in rule for new members under 25 and balances under $6,000; effective 1 April 2020) — apra.gov.au	Government / regulator	2020
2	Treasury Laws Amendment (Putting Members' Interests First) Act 2019; Protecting Your Super package (16-month inactivity cancellation) — apra.gov.au	Legislation / regulator	2019
3	Christopher Hall, Arrow Equities — observations from 500+ life insurance policy reviews (insurable-window inversion; three-exclusion decline threshold)	CH dataset	2026

Educational Disclaimer: This content is for educational purposes only and does not constitute financial advice. Past performance is no guarantee of future results.

The information, opinions and other materials appearing on the Web Site are of a general nature only and shall not be construed as advice. Arrow Equities, AFSL 526688, ABN 87 645 284 680. This general information is educational only and not financial advice, recommendation, forecast or solicitation. Rose Bay Equities accepts no responsibility for the accuracy or completeness of the information, opinions or other materials provided on or accessible through the Web Site. The Web Site has not been prepared with reference to your individual financial or personal circumstances. You should not rely on any advice in this Web Site without first seeking appropriate professional, financial and legal advice. Further, where Rose Bay Equities makes third party material available or accessible through the Web Site you acknowledge that Rose Bay Equities is a distributor and not a publisher of that content and that its editorial control is limited to the selection of those materials to make available. We accept no liability for any loss or damages arising from use.