Parliament inquiry into superannuation life insurance

With all working Australians required to have superannuation, it's an issue that effects everyone.

Some companies are taking advantage of the complex nature of super to bundle/burden people with additional policies.

At a rough guess, Senator Williams said up to seven million working Australians do not even realise they have life insurance tied to their superannuation.

"People I talk to are not aware of what is in their super," he said.

"They leave it alone so it can grow into a big nest egg for their retirement. That's hard to happen when money is constantly being taken out of it for life insurances that you didn't even know you had, let alone want."

The Nationals senator is in the final stages of creating a terms of references for a parliamentary inquiry into the life insurance sector, which will aim to weed out the dodgy practices within the industry.

"I know workers who were paying $1000 in life insurance a year from their super - next thing they know it's been upped to $2000 a year without warning," Senator Williams said.

"[The insurances provider] started taking double because they had a bad year."

Life insurances should be an opt-in situation, not an opt-out one.

"You should be able to decide if you want life insurances and if you do, you should choose what policy you want not this one-size fits all approach."

Once the parliamentary inquiry is underway, Senator Williams said he wants to hear from anyone who has been effected by the issue.

"We let the people tell us what needs to change, then we find solutions and make recommendations to the government," he said.

“The committee will open submissions for a couple of months, with hearings until February, then a report around April.”