Super funds failing Australians when they need them most: ASIC report reinforces urgent need for mandatory standards 

A damning new ASIC report has revealed widespread failings by super funds in handling death benefit claims—delays, unfair treatment, and a total lack of transparency—leaving grieving Australians without support at the most difficult moments in their lives.

Super Consumers Australia CEO Xavier O’Halloran said the findings show super funds are failing in their basic responsibilities to members and their families.

“This report confirms what we’ve been hearing from families in crisis: super funds are blind to their own failures, with no targets, no monitoring, and no accountability,” Mr O’Halloran said.

“It’s shocking that no fund has set a target for how long it should take to process a death benefit claim. As a result we’ve seen people subject to years of delay. These are people who’ve just lost a loved one—and they’re forced into a bureaucratic maze with no end in sight.”

ASIC found:

• 4 in 5 of the reviewed claims were delayed by processing issues within the fund’s control.
• Zero funds tracked end-to-end processing times, leaving them blind to delays.
• Larger balances were paid faster, raising serious equity concerns.
• Some trustees are ignoring binding nominations and engaging in overcomplicated reviews increasing waiting times and distress for grieving families.

Super Consumers Australia is calling for the Government to urgently introduce mandatory service standards, including timeframes for processing death benefit claims, and to adopt ASIC’s plain language guidance into Treasury’s upcoming standards work.

“ASIC has laid out the steps. The Government must now turn this into enforceable obligations—so no family is left in the dark at the worst time in their lives,” Mr O’Halloran said.

Super Consumers is also urging the Government to fund a pilot legal support service to help vulnerable Australians navigate complex claims processes. This would help put an end to the gross inequality in outcomes that is currently occurring, with only those who can afford to spend thousands on professional support getting the money they are owed in time. While this service would not be designed to cover every need in the community, it would be the canary in the coalmine to identify and address failures before they escalate to the size shown in this report.