Superannuation trustee Retail Employees Superannuation Pty Ltd (Rest) has paid $37,560 in penalties after the corporate watchdog alleged it misled members about their insurance status.
The Australian Securities and Investments Commission (ASIC) said more than 2,000 Rest members were wrongly told they held death, total and permanent disability or income protection cover between June 2024 and January 2025. In reality, those members had either cancelled their insurance, opted out, or were otherwise ineligible.
The regulator argued that by sending annual statements and follow-up emails to the affected group, Rest represented it was entitled to both activate cover and deduct premiums—claims ASIC maintains were without basis.
Rest paid two infringement notices on September 22 but, in line with standard practice, that payment is not regarded as an admission of liability.
The case highlights ASIC’s 2025 enforcement agenda, which includes a focus on insurance and administrative errors that can eat away at retirement balances. The regulator said it expects trustees to invest in systems that avoid such failures, and to act swiftly when errors do occur to prevent members being misled.
“Better retirement outcomes and quality member services” remains a key strategic priority for ASIC in 2024–25, with enforcement activity one way it is seeking to raise industry standards.
Rest, which oversees more than two million accounts, has not commented publicly on the matter.
The infringement notices were issued under section 12GX of the ASIC Act, which allows the regulator to respond quickly and proportionately where it believes there has been a breach. The details of ASIC’s concerns are published on the regulator’s infringement notices register.
The issue also comes against the backdrop of the Protecting Your Superannuation and Putting Members’ Interests Firstreforms, introduced in 2019 and 2020, which curtailed default insurance arrangements to protect account balances. Under these reforms, cover is not automatically provided in some circumstances—for example where a member is under 25, holds less than $6,000, or has an inactive account.
Members retain the right to decline or cancel insurance cover altogether.
