Non-Lapsing Binding Death Benefit Nomination

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A Non-Lapsing Binding Death Benefit Nomination is a death benefit nomination made to the trustee of your superannuation account that does not have an expiry date. Traditionally, Binding Death Benefit Nominations would expire every 3 years, meaning they would need to be updated or reconfirmed every 3 years.

However, a Non-Lapsing Death Benefit Nomination removes the need for this regular update.
Such a nomination is binding on the trustee, meaning that the trustee must adhere to your request and not use their discretion when making death benefit payments.

As mentioned, Binding Death Benefit Nominations traditionally had an expiry of 3 years. This was a safeguard against people who failed to update their nominations as their circumstances changed. The risk of a Non-Lapsing Binding Death Benefit Nomination is that an individual could forget who they have nominated to receive their benefits, which may result in their superannuation and Life insurance being paid to unintended beneficiaries.

Before making a Death Benefit Nomination you should take into account the taxation consequences of paying benefits to certain beneficiaries.

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