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Nominating a beneficiary (or beneficiaries) for your Group Life Cover and Retirement Fund is very important – have you completed your nomination form and is it still up to date?

There can be no doubt that you want your death benefits to go to the people you want them to go to if you were to die during your employment. It is therefore vital that you complete the beneficiary nominations for your Group Life Cover and Retirement Fund.

Please note:

  • If a nomination form is not clear or is incomplete the benefit payment will be delayed for up to 12 months or longer

  • The beneficiary form must be fully completed and signed by you. Any alterations to the form should be signed by you as well

  • Your Employer must always keep the beneficiary nomination in your personnel file as insurance companies do not always keep a record of the beneficiary forms

  • You should update your form on a regular basis and particularly when there is a change in your situation. e.g., marriage, divorce, have a baby etc.

  • The percentage allocation to dependents and nominees must add up to 100%

Who can I put as a beneficiary?

Your death benefits are either “approved” or “unapproved”

The death benefits on your retirement fund (i.e. the retirement fund cash value) is always an approved benefit. The death benefits of your group life cover may be approved or unapproved. If you are unsure, your group risk benefit statement will state this.

Approved Group Life and Retirement Fund Benefits are subject to Section 37c of the Pension Fund Act and the death benefit has to be distributed to dependents as defined in the act. The trustees of the fund will finally determine who the dependents are and the apportionment of benefit to each dependent. It is therefore vital that you put ALL your dependents on the beneficiary nomination form and a percentage allocation for each one. If you leave out dependents it will delay the pay-out. If you do not have any dependents you can make anyone your beneficiary/ nominee.

What is the difference between a Dependent and a Nominee?

Dependents are:

  • A spouse, including a customary law spouse or life partner (whether same sex or not)

  • Minor children, including those adopted, from a previous marriage or born outside of marriage

  • Other legal dependents such as a former spouse to whom one pays maintenance

  • Other individuals who are financially dependant on the member (for example an aged parent, family member or friend)

Nominees are:

Any person who is not dependent on you, but who you would like to receive part of your benefit.

Unapproved Group Life benefits

This does not fall under the Pension Fund Act and you can make anyone you want a beneficiary.

If you require any assistance regarding the completion of your beneficiary nomination forms please contact Rehana or Diane on (011) 778-9300 or email Rehana@fpm.co.za or Diane@fpm.co.za.

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. Errors and omissions excepted. (E&OE)