As recently communicated, it is more important than ever for ALL employees to complete a Beneficiary Nomination Form (BNF). In the event of a death, the employer can no longer appoint the distribution of benefits to beneficiaries. According to a ruling by the Prudential Authority, insurers are only allowed to distribute the benefit in accordance with the completed BNF, and in instances where the BNF is not present, it must be paid to the deceased member’s estate.
For Sanlam schemes that specifically requested that claims be paid according to employers’ instructions, there will still be a transition phase to remove any reference to this allowance as these decisions were made at implementation and have been included in the Certificate of Participation. Additional communication will be sent to inform and update affected employers of changes that will be required to comply with regulations.
In the past, some employers have advanced payments, especially with regards to the funeral benefit, and would request the benefit be paid back to them. This is not something that has ever been encouraged as the claim could be repudiated, leaving the employer out of pocket. Going forward this practice is also no longer accomodated and an insurer may not pay benefits to an employer as the definition of Beneficiary in regulations does not include the employer.
You can download a copy of the new TSA Nomination form that has been approved for use by all of our insurers HERE.
Should you have any queries in this regard please do not hesitate to contact us.
