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Grieving families could be pushed towards asking banks to pause mortgage repayments as super funds delay some death benefit payouts.<\/p>\n
Grieving families could be pushed towards asking banks to pause mortgage repayments as superannuation funds take more than six months to release some death benefit payouts.<\/p>\n
A follow-up review by the Australian Securities and Investments Commission has sparked calls for mandatory customer service standards after exposing slow progress across the super industry.<\/p>\n
Baseline Financial director Damian Medici said delays in accessing money after a death could place households under severe pressure when bills, debts and home costs continued. Rip Curl creative lists cool father-son project<\/a><\/p>\n Shock: 11 Aus banks slash rates in RBA blow<\/a><\/p>\n \u201cIf the family needs that money to cover bills, debts, mortgage repayments or living costs, then yes, that can be a real concern,\u201d Mr Medici said.<\/p>\n \u201cIf they are relying on the payout and they are waiting months for it, that creates a lot of financial stress on top of the grief they are already dealing with.<\/p>\n \u201cFor families without a cash buffer, that kind of delay can be very difficult.\u201d<\/p>\n Baseline Financial director Damian Medici warned families could face severe pressure when one income stops but mortgages, debts and bills keep arriving.<\/p>\n Mr Medici said some families could be forced to ask banks for breathing room if one income disappeared before death benefit money arrived.<\/p>\n \u201cPeople generally do one of two things,\u201d he said.<\/p>\n \u201cSome will panic and try to find a job or replace the income very quickly.<\/p>\n \u201cOthers, if they do not have money behind them, may need to go to the bank and ask for their loan repayments to be paused or put on hold to give them some breathing space.<\/p>\n \u201cIt comes back to the importance of having a proper emergency buffer. When one income stops, the bills do not stop with it.\u201d<\/p>\n Mr Medici said poor communication from super funds, banks or estate representatives could make it harder for families to plan after a death.<\/p>\n \u201cThe biggest issue is not knowing what to expect,\u201d he said.<\/p>\n \u201cIf people do not understand the timeline, the process, what documents are needed, what decisions have to be made and when the money might be released, it becomes very hard to plan.<\/p>\n \u201cYou have the super fund, the bank, the estate, lawyers and family members all potentially involved at once. A clear process would make a big difference.\u201d<\/p>\n Consumer advocates are calling for mandatory service standards after ASIC found slow progress on super death benefit payout delays.<\/p>\n ASIC\u2019s review shows death benefit payout handling improved by only 3 per cent across the industry.<\/p>\n Large funds with more than $50bn in member benefits improved by 19 per cent, but almost all large funds that improved had already been included in ASIC\u2019s original review or enforcement action.<\/p>\n The review also shows many funds still had not set targets for how long death benefit payouts should take.<\/p>\n Superannuation complaints to the Australian Financial Complaints Authority rose by 29 per cent in 2025.<\/p>\n The Australian Financial Complaints Authority has also raised concerns about systemic issues in super, including poor oversight of death benefit payouts and inaccurate communication that left consumers unclear about the process, time frames and their rights.<\/p>\n Super Consumers Australia chief executive Xavier O\u2019Halloran said grieving families were still dealing with confusing processes, poor communication and unacceptable delays.<\/p>\n Super Consumers Australia chief executive Xavier O\u2019Halloran said the review showed grieving families were still being let down.<\/p>\n \u201cThe only super trustees that have shown significant improvement are the ones ASIC has already spent thousands of hours dealing with through the original review or enforcement action,\u201d Mr O\u2019Halloran said.<\/p>\n The consumer group said many funds still had not implemented one of the most basic recommendations: setting targets for how long death benefit payouts should take.<\/p>\n Superannuation complaints to the Australian Financial Complaints Authority rose by 29 per cent in 2025.<\/p>\n Mr O\u2019Halloran said families who had lost loved ones were still being left to navigate unclear systems.<\/p>\n \u201cPeople who have just lost a loved one are still dealing with confusing processes, poor communication and unacceptable delays,\u201d he said.<\/p>\n \u201cAt the same time, complaints across the super sector continue to rise.\u201d<\/p>\n Mr O\u2019Halloran said leaving improvements to the industry had not worked.<\/p>\n \u201cASIC\u2019s findings show a tinkering-around-the-edges approach by super funds,\u201d he said.<\/p>\n \u201cLeaving improvements up to the industry has clearly not delivered good outcomes for consumers.\u201d<\/p>\n ASIC\u2019s review also highlighted a lack of support for First Nations customers and people experiencing vulnerability.<\/p>\n Mob Strong Debt Help acting director Mark Holden said strict identification rules could leave First Nations families blocked from basic information. Picture: ABC<\/p>\n Mob Strong Debt Help acting director Mark Holden said superannuation was one way First Nations families provided security for retirement or loved ones, but many funds still relied on rigid systems.<\/p>\n \u201cThere are many administrative burdens in the superannuation sector that need culturally informed services tailored for First Nations customers and their beneficiaries,\u201d Mr Holden said.<\/p>\n Mr Holden said strict identification rules could leave grieving families blocked from basic information about a deceased loved one\u2019s super.<\/p>\n \u201cThis creates uncertainty as to whether you have the right ID,\u201d he said.<\/p>\n \u201cWe see a small handful of super funds making an effort to improve their services for First Nations customers, but we should not be seeing this as a gold standard.<\/p>\n \u201cEvery First Nations customer should expect their super fund to consider their needs and circumstances.\u201d<\/p>\n Sign up to the Herald Sun Weekly Real Estate Update. Click here <\/a>to get the latest Victorian property market news delivered direct to your inbox.<\/p>\n MORE: Melb first-home buyer adds six figures to sale<\/a><\/p>\n
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