Superannuation death benefits play a critical role in estate planning, as they ensure the proper distribution of your superannuation entitlements to your nominated beneficiaries. These benefits, which may include the accumulated superannuation balance and any associated life insurance proceeds, are generally paid directly to dependants or the estate, depending on the nominations made by the member. By carefully considering and updating these nominations, individuals can provide financial security to their loved ones, minimise potential disputes, and achieve peace of mind knowing their assets will be distributed in accordance with their wishes. Superannuation death benefits are therefore an essential component of a comprehensive estate plan.
Understanding Binding Nominations
A binding death benefit nomination is a legally binding instruction provided by a superannuation fund member to their superannuation trustee, directing how their superannuation death benefits are to be distributed in the event of their passing. These nominations are an essential component of estate planning, as they ensure that superannuation benefits are distributed in accordance with the member’s wishes, rather than being left to the trustee’s discretion.
Binding nominations can provide certainty and peace of mind, particularly in complex family situations or where there are specific individuals the member wishes to benefit. Binding nominations can only be made to a certain class of person (spouse, children persons financially dependent on you) or to your estate.
Without a valid binding nomination, the trustee of the superannuation fund may exercise discretion in determining the distribution of the death benefit, which could lead to outcomes that differ from the member’s intentions.
Recent Changes to Cbus Superannuation
Cbus Superannuation has recently implemented changes to its policies and procedures regarding binding death benefit nominations. These changes, effective from October 2026, may impact members’ ability to make, renew, or update their binding nominations and also remove any existing non-binding nominations.
While the full details of the changes should be reviewed in the official communication from Cbus, the key updates include:
- Introduction of Online Nomination Updates: Members can now update their binding nominations through the Cbus online portal. This change is intended to streamline the process and make it more accessible for members to manage their superannuation arrangements.
- Revised Validity Periods: The validity period for binding nominations has been updated. Previously, binding nominations were valid for three years and required renewal to remain effective. Under the new rules, members have the option to make non-lapsing binding nominations, which do not require periodic renewal. However, members must ensure that their nominations meet the legal requirements to be considered valid.
- Enhanced Notification System: Cbus will now provide members with reminders when their binding nominations are approaching expiry (for those with lapsing nominations) or if any issues arise that may affect the validity of their nomination.
- Changes to Witnessing Requirements: The witnessing requirements for binding nominations have been clarified. Members must ensure that their nominations are signed in the presence of two independent adult witnesses who are not beneficiaries of the nomination.
Implications for Members
These changes present both opportunities and responsibilities for Cbus members. The introduction of non-lapsing binding nominations, for example, may reduce the administrative burden of renewing nominations every three years. However, members must remain vigilant to ensure that their nominations remain valid and reflect their current wishes.
It is also important to note that binding nominations are only valid if they comply with the requirements set out in the Superannuation Industry (Supervision) Act 1993 (Cth) and the rules of the specific superannuation fund. Failure to meet these requirements could result in the nomination being deemed invalid, leaving the distribution of the death benefit to the trustee’s discretion.
What do you need to do?
To ensure that your superannuation arrangements align with your estate planning goals, consider the following steps:
- Review Your Current Binding Nomination: Check whether you have a binding nomination in place and confirm its validity. If you have a lapsing nomination, ensure it is renewed before it expires.
- Consider Non-Lapsing Nominations: If your superannuation offers non-lapsing nominations, assess whether this option is suitable for your circumstances. While non-lapsing nominations do not require renewal, it is still advisable to review them periodically to ensure they reflect your current wishes.
- Update Your Nomination as Needed: Life events such as marriage, divorce, the birth of a child, or the death of a nominated beneficiary may necessitate changes to your binding nomination.
- Ensure Compliance with Witnessing Requirements: When making or updating a binding nomination, ensure that it is signed in the presence of two independent adult witnesses who are not beneficiaries.
Conclusion
The recent changes to Cbus Superannuation’s binding nomination policies underscore the importance of proactive estate planning. Nominations should be considered for their validity, effectiveness and tax implications.
By understanding these changes and taking the necessary steps to review and update your superannuation arrangements, you can ensure that your death benefits are distributed in accordance with your wishes.
At Lynn and Brown, we offer comprehensive estate planning advice, including a review of your nominations and discussions on how to ensure that they are in alignment with your estate planning objectives. If you would like to book a time to speak with one of lawyers, contact us by calling 08 9375 3411.
About the Author: This article was authored by Candice Jonker, Candice graduated from Murdoch University with a Bachelor of Laws and a Bachelor of Business and was admitted to practice in 2019. During her time as a solicitor, Candice has gained experience through various areas of law, including commercial transactions, employment law, business succession, wills and estate planning and estate administration. Candice’s focus over the last several years has been on Estate and Business Succession Planning and Estate Administration, including all aspects of succession including trusts, family arrangements and business and commercial structures. Candice graduated from her Masters in Law in 2023, specialising in Wills & Estates Planning and Estate Administration and became an Accredited Specialist in Wills and Estates in 2025. Candice is also a full member of STEP and the Vice-President for the Collaborative Professionals WA.
