Your nomination is not binding for a death benefit paid by the retirement fund. The trustees of the retirement fund ultimately decide who receives the benefit, as per the Pensions Fund Act, which governs the distribution of your benefit. But the absence of a nomination or an out-of-date nomination will delay the process of paying the benefit, thus causing financial hardship for your dependents. Your nomination is an important guide for the trustees.
If your death benefit is provided via a separate unapproved company group life plan, the benefit is paid to the persons you nominate. The absence of a nomination form or an incomplete one could mean that your benefit is paid to your estate or the company will decide who your beneficiaries should be. In other words, your benefit may not go where you intend it to go.
Whatever type of fund you belong to, the essential message is that you must ensure that your company has an up-to-date record of your beneficiary nomination form.
The form should be up-to-date and should at all times reflect the persons you wish to benefit. Our circumstances are constantly changing, through marriage, divorce, the addition or loss of a dependant etc. Whenever these circumstances change, you should take time to review and update your nominations.
This article is a general information sheet and should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.