Pension fund members who do not keep their nomination of beneficiaries forms updated risk their family members being unable receive death benefits after they have passed on.
The wishes of the deceased are taken into account by Boards of Trustees, who have to have to consider the distribution of death benefits to potential beneficiaries.
The nomination of beneficiaries’ form must be kept up to date with all necessary information, to have peace of mind knowing that all relevant information would be available for Trustees to make a just allocation between the deceased’s legal and factual dependents, says Christel Botha, Fiduciary Services Manager at Alexander Forbes.
According to the Pension Funds Act, Trustees of retirement funds have the responsibility to investigate legal and factual dependency by potential beneficiaries and to make a just allocation based on their investigation and the confines of the law. As part of their investigation, Trustees would also consider the wishes of the deceased contained in the nomination of beneficiaries’ form.
“A nomination of beneficiaries’ form is a valuable piece of information for trustees to better understand the deceased’s family environment and to start identifying potential beneficiaries,” Botha says. “If the forms are outdated, it may delay the investigation by the Trustees. This is why it is important for members to keep these forms updated every time there is a change such as getting married, divorced or the birth of a child.”