As previously communicated, members must complete a Member Beneficiary Nomination form in respect of their group funeral insurance benefit otherwise the benefit will be paid into the member’s estate.
The Prudential Authority has provided clarification, where they confirmed that the omission of such discretion from the definition of “beneficiary”, as contained in Schedule 2 of the Insurance Act 18 of 2017 (“the Act”), was deliberate in its statutory construct.
Given the intent of the funeral benefit is to contribute towards an employee’s immediate funeral costs, neither the employer nor minor children should be nominated as beneficiaries to avoid payment delays. It is important to note that the Member Beneficiary Nomination form process applies to all unapproved funeral benefits, irrespective of the Trustee-approved insurer. The insurers have advised that going forward they will no longer pay out any Funeral benefits without a nomination form. In cases where a Funeral nomination form is not available, the benefit will form part of the estate and may not be available to cover Funeral costs at the time of the funeral.