For most ordinary folk, without squillions of dollars, inheritance is about the handing on of the house and superannuation. With more blended families, there is a steady stream of disputes over superannuation death benefits.
Superannuation does not form part of the estate.
For the December quarter of last year, death complaints made up 29.1 per cent of all written complaints within jurisdiction. That was the second-highest category following administration complaints.
Most funds only offer a preferred nomination of who receives their death benefits. Some funds offer binding nominations.
But the claims can always be made with the Superannuation Complaints Tribunal if someone disagrees with the decision of the trustee of the super fund over who gets the money.
When a fund member dies, the fund trustee normally pays the death benefit to one or more of the dependants or the legal representative of the estate. The Australian Securities and Investments Commission website, Money Smart, says for such benefits, the term dependants includes a spouse, children, people with whom the fund member has an interdependent relationship and those who depended on the fund member financially.
Often, when there is a dispute over death benefits, it is the adult children from the first marriage against their parents most recent partner. Generally, unless there is a binding nomination, the trustees tend to pay the death benefit to the partner of the deceased member and not to financially independent adult children. There is overriding thinking about superannuation that guides determinations. That is, superannuation is designed to provide for the retirement of the person or people who would have benefited from the super had the fund member not died.
The only way to make sure that the money goes to adult children is to make a binding nomination. But nominations are only valid for three years and must be renewed