Check your super death benefit nomination today

Your super could go to someone you never intended. Take five minutes today to check whether you have a valid death benefit nomination and whether it's binding.

New research reported by ABC News has found millions of Australians may have little or no control over who receives their superannuation and any attached insurance benefits when they die. More than a third of people surveyed said they had no death benefit nomination in place, while many others were unsure whether their nomination was binding.

If you haven't checked your nomination recently, now is the time.

Why your super doesn't automatically follow your will

Many people assume their superannuation will be distributed according to their will. In reality, super is generally held by a trustee and does not automatically form part of your estate.

That means the instructions attached to your super account can play an important role in determining who receives your super balance and any insurance benefits payable after your death.

What's the difference between a binding and non-binding nomination?

There are different types of death benefit nominations, and the distinction matters.

Binding death benefit nomination

A binding death benefit nomination is a direction to the trustee of your super fund about who should receive your death benefit when you die, provided the nomination is valid and complies with the fund's rules and relevant law.

For many people, a binding nomination offers greater certainty about where their super will go.

Non-binding death benefit nomination

A non-binding nomination records your wishes, but it does not strictly require the trustee to follow those wishes.

Instead, the trustee retains discretion when deciding who receives the death benefit. Depending on the circumstances, this can result in competing claims, delays, or disputes about who should receive the money.

If there is no nomination at all, the trustee will generally make the decision.

What makes a binding nomination valid?

The rules can vary depending on your super fund, but generally a binding nomination must:

• be completed in the form required by your super fund
• clearly state who should receive your super and how much each person should receive
• be signed and dated by you in front of two adult witnesses who are not listed as beneficiaries
• still be valid when you die and not have been cancelled or replaced
• only nominate someone who is legally allowed to receive your super, or your legal personal representative (the executor of your estate)

Generally, your super can only be paid directly to:

• your spouse or partner
• your children (of any age)
• someone in an interdependency relationship with you
• someone who was financially dependent on you
• your legal personal representative (so your super is paid into your estate and distributed according to your will)

An interdependency relationship has a specific legal meaning. It generally refers to two people who have a close personal relationship, live together, and provide each other with financial, domestic or personal support. It is different from simply being financially dependent on someone.

If you want your super to go to someone who is not an eligible dependant, you may be able to nominate your legal personal representative instead. This allows your super to be paid into your estate and distributed under the terms of your will.

Because the rules vary between super funds, it's important to check your fund's requirements and seek legal advice if you're unsure.

Why checking your nomination matters

The ABC News report highlighted the experience of families who faced lengthy claim processes after the death of a loved one and found many Australians may not realise they have little control over who receives their super after they die.

Research by Super Consumers Australia, reported by ABC News, found more than a third of people surveyed had no death benefit nomination in place, while a further 25 per cent did not know whether their nomination was binding. The organisation estimates millions of Australians may not have a binding nomination directing where their super should go.

Where there is no valid binding nomination, uncertainty about a person's intentions can increase the likelihood of disputes and delays at an already difficult time.

A simple check today could help reduce the risk of future complications for the people you care about most.

You should also review your nomination after major life events such as marriage, separation, divorce, the birth of a child, or the death of a nominated beneficiary.

How often should you review your binding nomination?

For many super funds, a binding nomination expires after three years unless you renew, update, or replace it in line with the fund's rules. Some funds offer non-lapsing nominations that remain in place until you change them, while different rules may apply if you have a self-managed super fund (SMSF). It's important to check the rules that apply to your fund.

Just as importantly, your nomination should be reviewed whenever your circumstances change. Relationships, financial arrangements, and family situations can evolve, so a binding nomination shouldn't be treated as a "set and forget" document.

For example, you may nominate your spouse as your beneficiary, then later separate or divorce and enter a new relationship. If your former spouse is no longer eligible to receive your super when you die, an outdated nomination may no longer be valid or effective. In that situation, the trustee may need to decide how the benefit is distributed under the fund's rules, which can lead to delays, uncertainty, and disputes between potential beneficiaries.

Regularly reviewing your binding nomination helps ensure it reflects your current wishes and reduces the risk of unintended outcomes.

Having problems with a super death benefit claim?

Even with clear instructions in place, disputes and delays can still arise.

If there are questions about a death benefit nomination, competing claims from family members, or concerns about how a super fund has handled a claim, our specialised superannuation team may be able to help.

We offer free initial consultations and work on a No Win, No Fee basis in eligible matters, so you can get advice without worrying about upfront legal costs. Send us a message or call 1800 196 050 to discuss your situation.