Industry fund REST Superannuation has overhauled its insurance business, establishing an offering based on the needs of its 1.7 million members.

The benefits include an approach to insurance cover in line with the different stages of life.

The arrangements will focus on member needs instead of being based on a fixed cost. The issue of overinsurance has also been addressed in the new package, REST Superannuation chief executive Damian Hill said.

"As people get older, so do their responsibilities such as starting a family and paying off a mortgage. As such their death cover should also increase," Hill said.

The fund's members will also have a choice of a basic package of death, total and permanent (TPD) disablement and long-term income protection (IP) cover, or a mix depending on the person's need and budget.                                 

IP protection will also be extended to the age of 60, with the new cover also paying an amount of 9 per cent into super.

The changes will result in an increased cost for the basic unit of cover. Members up to the age of 34 previously paid $2.00 a week. Under the changes, members aged up to 17 will pay less at 90 cents, those aged 18-24 will pay $2.20, while people in the 25-34 age group will pay $4.90.

Almost half of REST's members are under 25 and almost 75 per cent are under 35.

It is not possible to do a comparison of costs because the previous and new levels of cover are so different. However, Hill said some members will be paying more for this cover.

"The result of our insurance product offering has meant a higher engagement with members. We believe other funds will look closely at our new design," Hill said.