The problem, though, is that they remain unaware of the monies bequeathed to them, and therefore cannot take the necessary steps to claim these funds. Often, this is because the policy holder neglected to tell them they had been named as beneficiaries, and had also omitted to keep the insurance company updated with their details – a small step that would have made it possible for the insurer to get in touch once the investment became payable.

As unlikely as it sounds (after all, people purchase policies precisely so that their loved ones can enjoy a financial cushion after they have passed on), this situation is far from uncommon. In fact, according to Craig Baker, CEO of MiWayLife, the company has claims worth more than R8 million that have been approved but not yet paid out, because it has not identified any beneficiaries, or because beneficiaries are still minors. These claims include life cover and funeral cover claims, stretching back to 2017.

Keep your insurer updated

The tragedy of this isn’t simply the fact that your family may be struggling financially after your passing, says Baker; it’s also that it’s so easy to avoid them falling into this trap. “All it takes is a regular check in with your insurance company to provide them with your most recent details, such as residential address and phone number, especially if these have changed; as well as those of your beneficiaries,” Baker comments. This becomes even more important if beneficiaries emigrate; a development which will make it even more difficult for the insurer to locate them should the claim become payable, unless their details on file.

It's equally important to keep a record of all insurance and funeral policies, as well as unit trust investments. Baker advises that these are best stored along with your will, so that your loved ones are able to obtain a clear picture of your policies. “If you lose any critical related documentation, be sure to inform the initiating company as soon as possible, so that it can be replaced,” he says.

Are you a beneficiary?

What if you are experiencing the situation from the opposite perspective? Perhaps a loved one has passed recently and you have not been informed of whether they had a policy in place; for example, or maybe you are a beneficiary of such a policy. In this case, says Baker, your best course of action is to peruse all documents left by the deceased – from income tax returns to policy contracts – and make contact with any financial professionals, employers or insurance companies mentioned in the documents. Most insurers will be able to assist those who need advice or information through contact via their call centre or helpline. Be sure to have all necessary information at hand when you reach out, including your ID and bank details, the death certificate, and policy contract.

Alternatively, you can search the website of the Association for Savings and Investment South Africa (ASISA) for lost policies.

What happens to unclaimed funds?

The good news? If you are, indeed, a beneficiary, the financial services company holding your monies may not take ownership of your unclaimed assets – no matter how much time has elapsed. “Insurers are required to keep trying to make contact with beneficiaries,” Baker informs. This process starts six months after the claim becomes payable, and must be repeated after three years if this first attempt is unsuccessful.

If the insurer is still unable to locate beneficiaries at this stage, they are required to try yet again after 10 years have passed. After this, they will be required to engage an external tracing agent (unless the cost of doing so if greater than the actual amount of the claim); plus, they need to make sure that your unclaimed benefits keep growing. It is only after 100 years that a company may assume that there are no longer any beneficiaries; after this time, the funds must be invested in CSI projects.

“Given the state of the global economy, financial wellbeing is a prime concern for all of us. Keeping your insurer abreast of any changes is one way you can be sure your family’s finances are protected,” Baker concludes.