CHOOSING BENEFICIARIES

Things you should know when selecting BENEFICIARIES

Life is unpredictable, which is why your policies should be updated regularly so you have peace of mind that the right people will get paid out.

HAVING OUTDATED POLICIES CAN BE AN EXPENSIVE MISTAKE. The wrong people could be recipients of a payout, leaving those you care about high and dry. Consider these points when it comes to your policies.

YOUR EX WON’T

AUTOMATICALLY

BE REMOVED FROM YOUR POLICY

If you get divorced, unless you manually request for your former spouse to be removed as a beneficiary on a policy, they will be eligible for the payout of that policy if you die. Queen Kganyago, provincial executive at Sanlam, adds: “Getting married will also not automatically affect the beneficiaries on your policies.”

THE DEATH OF A BENEFICIARY

While there is no age restriction for beneficiaries, think long term about the impact of nominating an older person. If, for example, your grandparent is a beneficiary of your life policy, but they die before you do and the policy isn’t updated, the proceeds of the policy will be paid to your deceased estate, not your

GET EXPERT HELP!

If you need to update your policy beneficiaries, a financial planner can help you. Book a meeting with one today by calling 086 123 5433. grandparent’s deceased estate, says Kganyago.

ARE YOU A SINGLE PARENT?

Minors aren’t eligible for a direct payout, so you need to appoint a legal guardian to whom the policy will be paid. “In the absence of any guardians, the Master of the High Court may elect a guardian or a guardian fund to invest the money in,” says Kganyago.

UNDERSTAND YOUR WILL VS POLICY

Your policy is unaffected by your will as far as beneficiaries go. “A nominated beneficiary will still benefit from the policy regardless of whether they are included in your will,” says Kganyago.