Tower wins AustralianSuper mandate

Tower Australia has regained a substantial foothold in the group insurance market, picking up a key mandate from Australia’s biggest superannuation fund, AustralianSuper.

AustralianSuper announced this week that it had appointed Tower Australia as its new life insurance provider for an initial three-year term beginning later this year.

Announcing the awarding of the mandate, AustralianSuper said with annual premium cover of over $200 million, the new insurance package would also see the inclusion of income protection as part of the default cover available to members.

The fund said based on a like for like comparison between existing cover, the new deal would save over $48 million a year in premiums for members.

Commenting on the mandate, AustralianSuper chief executive Ian Silk described it as an enormous win for the fund’s members resulting from the fund’s scale.

“For some time, we have been aware of the chronic level of underinsurance in Australia,” he said. “These new arrangements will help our members ensure they have enough insurance.”

Silk said once in force, the new arrangements would give members an increase from 8 per cent to 31 per cent in the amount of death and disablement cover for the same cost and automatic income protection cover.