Members of the Motor Industry Retirement Fund (MIRF) must take note that it can take up to a year before their death benefit will be paid out because of the requirements Section 37 (C) of the Pension Funds Act.
This section places specific duties on the Fund to investigate, allocate fairly and determine that the benefit is paid to the correct beneficiaries, says Adam Esat, Principal Officer of MIRF.
“Due to these requirements, the death benefit cannot be paid out quickly enough to support dependants.”
According to Esat MIRF must do an investigation as to who are the legal dependents, the factual dependents and the future dependents of the deceased upon receipt of the notification of death.
“MIRF members can prevent delays by updating their nominees and ensuring that MIRF has the correct information and contact details on record. It is also important that MIRF members be honest on these nomination forms,” says Esat.
A claim takes between eight months to a year to be finalised. MIRF receiving an average of 150 claims per month.
A backlog of 1 800 claims developed with all the members that passed-on during the Covid-19 pandemic. Esat says MIRF is doing everything within its means to clear the backlog as soon as possible.
“The Fund must still investigate the claims, irrespective of the nominees. The beneficiaries must submit the correct documentation to speed up the process.
“It becomes a challenge when there is internal family issues and family members refusing to co-operate or even investigations. This slows down the process and could have been prevented if the MIRF member explained their wishes to the beneficiaries and relatives beforehand.”
Esat says the current process is very paper intensive and MIRF is looking at ways to make it easier through automation.
MIRF uses independent investigators to investigate claims and make recommendations to the Board of Trustees. The trustees must satisfy themselves that the claim will be paid to the correct beneficiary. If not, the fund can be sued by the correct beneficiary.
These are the guidelines for the payment of claims:
What is the difference?
Legal dependant – minor children or a spouse.
Factual dependant – a girlfriend, not legally related, but still financially depended on the deceased.
Future dependent – an unborn child or parents who might in future be dependent.
Issued on behalf of MISA by Sonja Carstens, Media, Liaison and Communication Specialist.