TAL partners with AustralianSuper for lifetime income option

Australia’s largest superannuation fund has announced a new “income for life” retirement option is in the works, in partnership with life insurer TAL.

AustralianSuper described this as a “major step forward”, with the new option poised to “go a long way in helping members to have the confidence to plan for and enjoy their retirement”.

The engagement with TAL builds on a longstanding partnership, with TAL providing insurance to around 1.4 million of the fund’s members and is expected to be available in early 2025.

“Retirement is deeply personal. There is no one size fits all, so it’s important that we are able to provide products, advice and services to meet members’ individual needs,” explained the fund’s chief retirement officer, Shawn Blackmore.

“For some, that means drawing down a regular income stream from their superannuation savings while also maximising the benefits of the aged pension. For others, it is providing the comfort that no matter what their retirement journey, they have the certainty of an income for life through a longevity product. While for others, it may be something else entirely.”

Jenny Oliver, TAL chief executive, group life and retirement, also flagged the importance of the advice element in the proposition.

“We look forward to partnering with AustralianSuper to provide retirement solutions that meet the evolving needs of members, particularly flexible lifetime income options, alongside access to guidance and financial advice, and supported by leading technology and digital capabilities,” Oliver said.

“Retirement solutions are a strategic part of TAL’s protection proposition. We have and will continue to invest significantly in our capabilities to support our partners to deliver their retirement income strategies across member experience, product and digital.”

She added that the new retirement income proposition would assist in building financial certainty for the fund’s members.

“Our role is to protect members throughout their lives,” Oliver said.

“We have a long history of protecting AustralianSuper members during their working years, and now we are delighted to have the opportunity to deliver a whole-of-life solution and provide protection to these members in their retirement, so they can enjoy these years with confidence and dignity.”

Previously, AustralianSuper’s Retirement Income Strategy identified a cohort of members who may benefit from a lifetime income option supplementing an account-based pension and age pension, Blackmore elaborated.

“A lifetime income option not only ensures members, and their partners, are able to have an income as they live, it may also enable a higher age pension entitlement through favourable asset and income test treatment,” he said.

An additional feature of the proposition will include that members only need to invest a proportion of their savings into the option.

The executive observed that many members transitioning to and in retirement cited additional stress and anxiety in this key phase of life, in part stemming from the complexity of the current superannuation system.

For Blackmore, it remained the role of AustralianSuper to “give members clarity, simplicity and confidence to spend the savings they have worked so hard for”.