media release (26-116MR)

Super stragglers dampen progress on death benefits delivery for grieving Australians

Published

Ongoing weaknesses in the death benefit claims handling practices of straggling superannuation trustees risk undermining confidence in the industry’s readiness to service Australia’s ageing population.

While many trustees have made positive inroads, ASIC’s progress review, Report 831 Delivering on death benefits: Have super trustees stepped up? (REP 831), suggests others have failed to implement basic process improvements in response to recommendations handed down in ASIC Report 806 Taking ownership of death benefits: How trustees can deliver outcomes Australians deserve (REP 806).

ASIC Commissioner Simone Constant said while it was pleasing to see many trustees take appropriate steps to address the claims handling failures identified by ASIC, the pace of improvement and an overall increase in claims volumes suggested not all trustees are well placed to meet future service pressures from Australia’s ageing population.

‘There are some promising findings in this report, including a 53% reduction in internal complaints about death benefit delays from early 2024 to late 2025,’ said Commissioner Constant.

'However, with claims volumes increasing by 10% in the 12 months to October 2025 and with that growth expected to continue in the context of Australia’s ageing population, it’s clear that more work needs to be done if all trustees are to meet member expectations.

‘We’re particularly concerned that some trustees have not actioned basic process improvements and continue exposing grieving beneficiaries to harm at times of heightened emotional and financial distress.’

ASIC’s latest review of the reported progress of 45 superannuation trustees highlighted the following areas where trustees should take action:

  • Measuring end-to-end claim times and holding themselves to account by setting performance targets that align to positive claimant outcomes.
  • Being responsible for their own risk appetite and customer impact in the processing of low-value and low-risk claims, especially the practice of claims staking. 
  • Treating their members and claimants as customers, helping with proactive communications about the most important steps like making a valid binding death benefit nomination. This is of heightened importance where there are language and communication barriers.
  • Enhancing support for First Nations members and claimants, including updating identification and other practices that produce sub-optimal outcomes.

‘There is no excuse for delays in delivering better outcomes for death benefit claimants. Super trustees have now had over two years to respond to concerns that we began raising back in 2024 with our publication on improving superannuation member services in May 2024 and a direct letter to CEOs on assessing practices for handling death benefit claims in November 2024,’ Commissioner Constant added.

‘Trustees that have made positive steps in the right direction should sustain this momentum and ensure they are equipped to manage future service pressures.

‘For trustees that have failed to take effective action, our progress review should serve as a wake-up call ahead of the Commonwealth Government’s proposed introduction of mandatory member services standards.’

Commissioner Constant said ASIC will continue to monitor trustee progress in improving death benefit claims handling practices and will hold trustees to account for member service failures.

‘Fund members have a right to expect claims will be handled efficiently, honestly and fairly — this is an obligation for trustees under law. ASIC will consider the full range of regulatory tools at our disposal, including enforcement action, if trustees fail in this crucial obligation.  We have done it before and if we need to, we will do it again.  This is a mission critical area for trust Australians place in their superannuation system,’ she said

The next phase of ASIC’s multi-year member services review is also underway. ASIC is testing how well superannuation trustees use member complaints data to identify and address systemic issues and to improve service delivery.

‘A surge in complaints relating to death benefits was a catalyst for our review of claims handling. In the same way, trustees should use complaints data as an early warning system to detect and mitigate risks to members,’ Commissioner Constant said.

‘Unfortunately, despite complaint numbers and trends rising overall between 2020 and 2026, early findings indicate that five of the 10 trustees we are reviewing have not identified a single systemic issue from analysis of their complaints data over our review period. At least one trustee failed to analyse their complaints data at all. This is baffling, and frankly, unacceptable.’

Earlier this month, the Federal Court found Telstra Super (now known as Tetra Servicing Pty Ltd) breached its complaints handling obligations (26-091MR) after ASIC took action against the trustee for failures to respond to about one third of complaints received between 22 October 2021 and 13 January 2023 within the mandatory 45-day timeline.

Background

ASIC commenced a multi-year project in 2024, looking at industry practices and compliance with laws relating to trustee administration and contact centres.

ASIC focussed on death benefit claims handling practices in the first phase after a concerning uptick in reports of service failures relating to death benefit claims and a steep increase in death benefit complaints to the Australian Financial Complaints Authority (AFCA). 

In March 2025, ASIC released REP 806, which outlined observations of both good and poor practices from our review of death benefit claims of 10 trustees over the 2-year period ending 31 March 2024. This followed an earlier Letter to CEOs of superannuation trustees sent in November 2024 highlighting the need for trustees to assess their death benefit claims handling practices and address deficiencies as a priority.

ASIC first raised concerns in an article published in May 2024, which identified broad failings from across a sweep of trustees in supporting members with basic communications and processes for fair and effective death benefits claims. 

Following the release of REP 806, which included a list of 34 actions for all trustees to consider, ASIC issued compulsory notices on 45 superannuation trustees to review industry progress in uplifting death benefit claims handling.

ASIC asked trustees to respond to a series of questions exploring what action they took in the period between 20 November 2024 and 20 November 2025 (review period) to consider and respond to the findings outlined in ASIC’s publications. This included seeking details of further planned improvements. ASIC chose 20 November 2024 as the commencement of our review period as this was the date ASIC published its CEO letter, which put all trustees on notice regarding the need to improve their death benefit claims handling practices.

For the full list of trustees involved in ASIC’s latest review, please refer to appendix A in REP 000.

Last November, the Federal Court ordered Construction and Building Unions Superannuation Fund (Cbus) to pay a penalty of $23.5 million (25-286MR) after ASIC sued the trustee for unreasonable delays experienced by more than 7,000 Australians in handling death benefits and total and permanent disability (TPD) insurance claims.

In March 2025, we commenced civil penalty proceedings against AustralianSuper alleging delays in processing of death benefit claims: see Media Release (25-034MR) ASIC sues AustralianSuper alleging significant death benefit claims failures (12 March 2025).

ASIC’s focus on death benefit claims handling failures was the first focus of a multi-year member services review and followed a surge in member complaints.  As part of its ongoing work on member services, ASIC is assessing how well superannuation trustees use member complaints data to identify and address systemic issues to improve service delivery. Findings will be published later this year.

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REP 831 Delivering on death benefits: Have super trustees stepped up?

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