AustralianSuper will stop providing default life cover for people aged under 25 who sign up with the fund.

The change, a “first” for the super industry, follows an internal analysis of member experience and feedback on default insurance premiums’ effect on account balances.

“AustralianSuper’s experience is that for claims paid for members aged under 25, only 10% are paid to financially dependent spouses or partners and children,” Group Executive of Membership Rose Kerlin said.

“People under 25 starting out in the workforce need to begin building a base for their retirement savings.

“Given they are often on relatively low incomes, the fund does not want to see undue account erosion because of insurance that may actually be of very limited value to them.”

Young members can still opt in to the cover, which offers death and total and permanent disability insurance.

The cover will start automatically when they turn 25, if they make no change.