Willem Beeby, Manager Growth and Innovation at TEBA

I wish it were possible to dress this article up with a catchy opening phrase, or hook, tying all the facts together in insightful but concise middle paragraphs and then finally rounding it off with a summary. Unfortunately, much like difficult conversations we have throughout life, it is not possible to dress it up, so allow me to provide an unfiltered view.

The cost of claiming is simply too high, and remains a major factor in resolving unclaimed benefits, especially for lower income households and foreign cases.

Letters of Authority / Executorship

• Amending benefit value letters is a costly exercise. In a recent case study a widow from Ganyesa spent;- R200 for a return taxi fare to Mahikeng, R600 for accommodation, R200 for food and a further R100 for printing and miscellaneous expenses for the Master to add an asset of R10 000 to her late spouses LOA. The payment will take up to three months and the spouse spent (R1100) half of her old age grant to amend the LOA. (Excluding other documents)
• Resealing Letters of Authority issued cross border is even more expensive. The same Widow will spend in excess of R3000 to travel from Xai Xai to Nelspruit to have the letter resealed. She is also not guaranteed of an outcome as the Master of the High Court in Nelspruit may not have a Portuguese translator on the day. Given the median income for pensioners in Mozambique, the impact is even more acute
• Opening estate late Accounts costs up to R500 – an added expense

Cost of official documents

• In RSA ID costs R140, Update Marriage Certificates R75 – at least death certificates are free, unless unabridged.
• The widow in Mozambique faces yet another challenge, the cost of official documents. Although these vary from district to district and after conversion into RSA Rand, the costs are roughly:
  • R1750 to R2000 for the Letter of Authority to be issued
  • R1000 for a passport – as in many cases spouses have not travelled abroad
  • R200 to R250 for a death certificate
  • R150 to R200 for an affidavit of customary union or residence
  • R7 per page certified
  • Sworn translations can cost up to $10 or R170 per page where this is required
• These costs are compounded by transport costs to travel to and from official offices in all regions.

Proof of employment

• There are funds that require a proof of employment that the member worked with the company and belonged to the fund in question.
• If one considers the historical migration trends in Southern Africa, this cost can also be significant.
• Example, a widow in Lusikisiki in the Eastern Cape will spend between R1000 and R2000 for travel and accommodation to obtain a proof of employment from a plant in JHB or Cape Town, provided the plant is still open and she finds it unharmed

To tackle the issue of unclaimed benefits, we must address claim complexity and the cost to claimants.

Adjusting claim requirements, centralising risk management, updating policies which govern minimum requirements for smaller benefit values, adopting technology in tracing and validation can all play a significant role.

Being “Activist Trustees” can play a more important role.

ENDS