Australia’s largest superannuation fund, Australian Super, is facing legal action from the Australian Securities and Investments Commission (ASIC) for significant delays in processing thousands of death benefit claims. ASIC alleges that Australian Super failed to handle claims “efficiently, honestly and fairly” between July 2019 and October 2024, leaving deceased members’ families waiting for payouts that sometimes took years to process.
The Allegations
According to ASIC, Australian Super took anywhere from four months to as long as four years to assess nearly 7,000 death benefit claims. The corporate regulator also accuses the fund of failing to pay benefits to the families of at least 752 deceased members as soon as practicable after their deaths. One claim, ASIC claims, took over three years to be processed despite all necessary documentation being available.
ASIC Deputy Chair Sarah Court highlighted the emotional toll these delays can cause, stating, “At its heart, this matter is about protecting vulnerable Australians and their families.” Court emphasized that delays during such an emotional time only add to the grief families are already experiencing.
Previous Cases of Super Fund Delays
This legal action follows ASIC’s previous lawsuit against another major super fund, Cbus, for failing to process more than 10,000 death and disability claims in a timely manner. Cbus, which apologized for the delays, committed to compensating the affected members. ASIC’s crackdown on super funds is part of a broader effort to address payment delays in the sector, which has raised concerns across the country.
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The issue has gained further attention from a recent Senate inquiry into the superannuation industry. The inquiry criticized funds like Cbus and called for major reforms in the $4 trillion super sector to ensure better protection for members, especially in the processing of death benefit claims.
Australian Super’s Response
In response to ASIC’s claim, Australian Super stated it was “considering the claim carefully and will respond on the substance of the claim in due course.” The super fund also expressed support for ASIC’s focus on the issue, acknowledging the importance of addressing delays in the industry.
Australian Super is the largest superannuation fund in Australia, managing over $355 billion in retirement savings for nearly 3.5 million members. It is not the first time the fund has faced legal scrutiny; in a previous case, Australian Super was fined $27 million for failing to merge duplicate member accounts, as required by law.
ASIC’s Ongoing Efforts
ASIC’s actions are part of its broader investigation into delays in death and disability payments across the superannuation industry. The regulator has emphasized that it is taking an intensive approach to tackling these issues. ASIC is expected to release a detailed report into the state of death benefit payment claims in the coming weeks, shedding more light on the scale of delays and their impact on families.
Industry-Wide Scrutiny
The legal action against Australian Super comes after a scathing assessment of the superannuation industry by a Coalition-led Senate inquiry in February 2025. The inquiry called for an overhaul of the sector, which currently manages Australia’s $4 trillion retirement savings pool. The report highlighted that delays in death benefit claims were a widespread issue, with calls for reforms to ensure quicker and more transparent processing of these critical payments.
ASIC’s actions against Australian Super and other funds underscore the growing pressure on the superannuation industry to prioritize the fair and timely treatment of its members, particularly during the vulnerable period following a loved one’s death. The regulator’s continued focus on this issue is expected to drive further scrutiny and changes in the sector to better protect consumers.
