The 3-year lapse rule, explained without jargon

Regulation 6.17A of the Superannuation Industry (Supervision) Regulations 1994 (Cth) sets out the conditions under which a super fund's trustee is bound by a member's death benefit nomination. Sub-regulation 6.17A(7) is the one that trips people up: a notice given to a trustee ceases to have effect at the end of 3 years after the day it was first signed, last confirmed, or last amended by the member.

A lapsed binding nomination is not automatically treated as a non-binding wish. It has no legal force at all. The trustee falls back to their discretion under the trust deed and the SIS Act, guided by the categories of eligible dependants.

The 3-year lapse rule applies to binding nominations made under Reg 6.17A in APRA-regulated funds — the big retail and industry funds most Australians are in (AustralianSuper, Australian Retirement Trust, HESTA, Hostplus, Aware, Rest, Cbus, UniSuper and so on).

Some funds also offer non-lapsing binding nominations. These are only available where the trust deed expressly permits them — they sit outside Reg 6.17A and are governed by the fund's own rules. Self-managed super funds (SMSFs) are also outside 6.17A; whether a BDBN lapses in an SMSF depends entirely on that fund's trust deed.

1. Log in to your fund's member portal and find the "beneficiaries" or "nominations" area.
2. Look for the type: Binding, Non-lapsing binding, Non-binding, or Reversionary pension.
3. If it says binding (and not "non-lapsing"), find the date signed. Add three years. That is the day it stops working.
4. If your fund won't show the date online, request a written statement of your current nomination — they are required to hold and disclose it.

A BDBN can be renewed at any time by signing a new one, or by confirming the existing one in writing to the trustee — which restarts the 3-year clock without you having to change anything. Most funds provide both a renewal form and a confirmation form.

A calendar reminder 60 days out from the expiry date is the single highest-leverage five-minute task in Australian estate planning. STEADCALM sets one for you when you save your BDBN.