A Binding Death Benefit Nomination (BDBN) enables a superannuation fund member to direct the trustee as to who is to receive their superannuation death benefit, provided the nomination is valid and complies with the applicable law and the governing rules of the particular fund.
Depending on the circumstances, a member may nominate one or more eligible superannuation dependants and/or their legal personal representative, in which case the benefit is paid to their Estate and dealt with in accordance with the terms of their Will.
By contrast, where there is no valid binding nomination, or only a non-binding nomination, the trustee of the superannuation fund may exercise discretion as to how the death benefit is distributed.
Recent research reported by ABC News estimates that approximately 15.7 million Australians may not have a valid Binding Death Benefit Nomination in place.
Why an Up-to-Date Binding Nomination Matters
For many Australians, superannuation is one of their most significant assets. Yet it is also an asset that can easily be overlooked when putting an estate plan in place.
Unlike assets held personally, superannuation does not automatically form part of your Estate or pass in accordance with your Will. Instead, it is held by the trustee of your superannuation fund and, depending on the arrangements you have put in place, the trustee may have discretion as to which superannuation dependant or dependants (or your estate), ultimately receives your death benefit.
Recent attention on delays in the payment of superannuation death benefits provides a timely reminder of the importance of ensuring your superannuation arrangements are properly considered as part of your broader estate plan.
Proposed changes to the payment of superannuation death benefits
The Federal Government has been consulting on the introduction of mandatory and enforceable service standards for large APRA-regulated superannuation funds, including standards relating to the timely and compassionate handling of death benefit claims. These proposed standards are directed at APRA-regulated superannuation funds and do not extend to self-managed superannuation funds (SMSFs).
The proposed changes follow increased regulatory scrutiny of the way APRA-regulated superannuation funds handle death benefit claims. In June 2026, ASIC reported that, despite some improvement across the industry, further work is required to improve the way superannuation trustees handle and process death benefit claims.
Importantly, ASIC’s work has also highlighted the impact that a member’s beneficiary nomination arrangements can have on the administration of a death benefit claim, with claims involving no beneficiary nomination or a non-binding nomination potentially taking longer to process.
Although the proposed service standards do not apply to SMSFs, the increased focus on death benefit claims provides a timely reminder for all superannuation fund members to consider what arrangements they have in place for the payment of their superannuation benefits on death.
Having a nomination is not necessarily enough
Depending on the rules of your particular superannuation fund, some Binding Death Benefit Nominations lapse after a specified period and may need to be renewed. A nomination may also cease to reflect your wishes following changes to your personal, family or financial circumstances. ASIC has similarly emphasised the importance of keeping binding nominations current and valid.
It is also important to remember that not everyone you may wish to benefit is necessarily eligible to be nominated directly. Superannuation law generally restricts the payment of death benefits to a member’s legal personal representative or eligible dependants. Accordingly, a nomination in favour of a parent, sibling or other relative will not necessarily be valid merely because of the family relationship; whether that person is eligible will depend on their particular relationship and circumstances at the relevant time.
For this reason, your nomination should be reviewed regularly, particularly following significant life events such as marriage, separation or divorce, the birth of children or grandchildren, the death of a nominated beneficiary or changes to your broader estate planning arrangements.
Simply recording your wishes does not necessarily mean the trustee will be legally bound to follow them. It is important to ensure that any nomination complies with the applicable superannuation law and the governing rules of your particular fund, and that each nominated beneficiary is eligible to receive the benefit.
Your superannuation and your Will should work together
A Binding Death Benefit Nomination should not be considered in isolation from your Will and broader estate planning.
For example, there can be significant differences between directing superannuation straight to an eligible beneficiary and directing it to your legal personal representative to form part of your Estate. The appropriate approach can depend on your family circumstances, tax considerations, asset-protection objectives and the structure of your estate plan.
This can be particularly important for people with blended families, adult children, vulnerable beneficiaries, significant superannuation balances or, in circumstances where you are trying to mitigate the risk of a potential estate dispute.
With increased attention being given to the administration and timely payment of superannuation death benefits, now is a good opportunity to check not only whether you have a Binding Death Benefit Nomination, but whether it remains valid, current and consistent with your overall estate plan.