Income protection through super: how it works and what it covers
Income protection pays a monthly benefit, usually up to about 75% of your income, while you can't work because of illness or injury. Not every fund includes it automatically, and where it's automatic the amount is often modest. You can apply for more.
What it pays
A monthly payment to replace part of your wage while you're off work. Most policies cap it at about 75% of your pre-disability income. Some add another 10% as a contribution into your super, so the cover is described as "up to 85%". The payment is taxed as income.
Three settings decide what you actually get.
The amount. Automatic cover is usually a fixed monthly figure set by age, not a percentage of your pay. AustralianSuper's automatic amount runs from $1,900 a month at 25 to about $3,100 at 40 to 45. Rest's is $3,000 a month insured at ages 25 to 44, of which about $2,679 is income and the rest goes to super. HESTA's is two units of $500, so $1,000 a month. For someone on $85,000, 75% of salary is about $5,300 a month, which is more than any of those.
The waiting period. The time you're off work before payments start. Common choices are 30, 60 or 90 days. A longer wait costs less but you need savings to carry you through it. AustralianSuper's automatic cover has a 60-day wait. HESTA's and Brighter Super's are 90 days.
The benefit period. How long payments can continue for a single claim. Two years is typical for automatic cover, though HESTA's is five years, and some funds let you choose to age 65.
Who gets it automatically
Not everyone. AustralianSuper, Rest, HESTA, NGS Super, NESS Super, Australian Food Super, Brighter Super (for members in some employer plans) and Equip's Catholic Super division include some income protection by default. Hostplus, Cbus, Aware, Australian Retirement Trust, Team Super, Vanguard, Essential Super, Bendigo SmartStart and BUSSQ don't (and UniSuper's Personal Account, Vision Personal and MLC Fundamentals only offer it on application), so you apply for it, with health questions.
Why the benefit period matters more than it looks
A shorter benefit period costs less. It also leaves more of the risk with TPD, because if you're sick for longer than the benefit period, nothing pays until you qualify for TPD. In our sample family (35, $85,000, a partner on $60,000, two young children and a $550,000 mortgage), the TPD cover they needed fell as the income protection period grew:
| Income protection held | TPD needed |
|---|---|
| None | $1.48 million |
| 2 years | $1.4 million |
| 5 years | $1.3 million |
| To age 65 | $875,000 |
It's one example, and your numbers will differ. The pattern is what holds: longer income protection means you need less of the big lump sum.
Inside super versus outside
Inside super the fund pays premiums from your balance and you can't claim a tax deduction for them. Outside super, premiums for income protection are generally tax-deductible, because the benefit is taxed as income. Retail policies also tend to offer extras that super cover doesn't, such as partial payments when you return part-time and longer benefit periods. They cost more and need a full health assessment.
How often claims are accepted
Income protection claims in group super were accepted 96.2% of the time in the 12 months to June 2026, and decided in about 1.4 months on average. The lowest insurer accepted 90.9%, the highest 97.6%.
Sources
- APRA and ASIC, Life insurance claims and disputes statistics, June 2026, group super channel
- Fund insurance guides (AustralianSuper, Rest, HESTA, Hostplus, Brighter Super) as at 22 October 2026
- Needs analysis: miadvice calculator, sample family described above
Compare income protection across funds
Free, no sign-up. Uses each fund's published rates and rules.
General information only, not personal advice. Fund rules and premiums change, usually on 1 July or 1 October. Check the fund's current insurance guide before relying on a figure here.