Binding death benefit nominations

The Superannuation Legislation Amendment Act 1999 allowed superannuation funds to offer members the opportunity to make binding death benefit nominations. If a member completes a binding death benefit nomination in the correct form, the trustee must distribute the death benefits to the nominated beneficiary or beneficiaries in the proportions specified and has no discretion to vary or override the allocation.

Witnessing, renewal and reporting requirements must be met for the nomination to be valid.

Funds are not obliged to offer binding nominations. To date, very few have done so.

Who may be nominated beneficiaries?

A nominated beneficiary must be the member’s legal personal representative or dependant at least at the time of death. There is some doubt as to whether this extends to the date of nomination.

Preferred nominations(i.e. non-binding nominations)

Most superannuation funds offer their members the opportunity to nominate their preferred beneficiaries. Contrary to general perception, trustees are not bound by such nominations.

Is there a valid binding nomination?

Anyone intending to make a claim for a superannuation death benefit should find out whether there is a binding nomination and, if there is, whether the strict pre- conditions for a valid nomination have been met.

Binding death benefit nominations  :  Last Revised: Fri Jul 25th 2014
The content of the Law Handbook is made available as a public service for information purposes only and should not be relied upon as a substitute for legal advice. See Disclaimer for details. For free and confidential legal advice in South Australia call 1300 366 424.
Link to sa.gov.au - find what you're looking for

© Legal Services Commission - All Rights Reserved
Funded with the support of the Governments of Australia and South Australia Website by CeRDI