One of the government’s main changes to the Your Future, Your Super is around stapling, or allowing for a member to stay with the same superannuation fund for their entire working life.

While on principle reducing multiple fees paid and having all superannuation in one lump sum will grow members’ nest eggs, the changes come with blaring unintended consequences.

Slater and Gordon’s practice group leader, Sarah Snowden, highlighted how members could be set one default fund despite changing jobs throughout their lifestyle, warning the insurance coverage might not be right for them.

“People need to give serious consideration and check that their current super insurance policy is the right one for the type of work they are going to be doing going forward,” she said.

In fact, one of the main drawdowns to not having multiple superannuation funds will mean workers could potentially miss out on additional cover.

“New super accounts will no longer be created every time a worker changes jobs, so injured workers won’t have the multiple insurance policies in multiple funds to rely on when making a claim as they have had previously,” Ms Snowden said.

While members might assume all insurance coverage under superannuation would be relatively similar, Ms Snowden highlighted the importance of knowing exactly what type of coverage workers have.

“Some total and permanent disability (TPD) and life insurance policies are industry- or employer-specific. A policy may exclude jobs deemed as hazardous based on working conditions, or offer benefits only to those employed in a specific industry, meaning a person who moves into a different role could be ineligible to claim against their own policy after paying premiums if they are injured or ill while working in that role,” she explained.

Ms Snowden also said that previous legislative changes which required members to opt in to keep insurance (where they had a low balance, didn’t make regular contributions or were under 25), had resulted in many members no longer holding crucial income protection, TPD or life insurance cover.

“People often overlook the fact that they have insurance benefits they can access if they become ill or injured and can no longer work within their super fund. It’s arguably the most cost-effective and affordable insurance for people to have, and it can be devastating to learn that you are no longer entitled to this insurance.

“Depending on your fund and insurance policy, you usually have about 60 days to have your insurance reinstated if you find it has been cancelled, without having to do a medical check and re-apply. The problem is that by the time people realise, it is too late,” she concluded.