Superannuation fund members under 25 and those with balances less than $6000 will no longer be forced to take out life insurance, as part of a reform package the government says will save the budget $700 million over four years due to higher taxes from super funds.

The reforms form part of a package of measures aimed at bolstering the retirement accounts of young savers and those on low incomes, leaving wealthier savers and self-managed super fund members largely alone.