A recent Business Insider article revealed that there is currently more than R17 billion in unclaimed or forgotten unit trusts and policies in South Africa. That’s a lot of unclaimed policies! Imagine sitting in your new hometown and discovering that you’ve got unclaimed funds just waiting for you back home in South Africa – what would you do with an unexpected windfall? The possibilities are endless. But before you start daydreaming about how you’d spend the money – let’s get real for a few minutes. Let’s take a look at what unclaimed funds are in South Africa, and how to find out if you’re due any unclaimed money from any investments or insurance policies.
Wait a minute. Why are there so many unclaimed policies in South Africa?
When policyholders stop making policy payments, investment firms or insurers convert these policies into accounts that are paid up. The funds that sit in these paid-up policies are meant to be paid out to the policyholder (or the policyholder’s beneficiaries) but because most people aren’t aware that their policies are now considered paid up and that they could get this money back, so they simply write these policies off, thinking that the money is lost to them.
Other reasons for unclaimed policies in South Africa
- The policyholder dies without beneficiaries or the beneficiaries are uncontactable or do not know of their unclaimed funds.
- The policyholder has forgotten about the policy, either because many years have passed since it was taken out, or due to dementia.
- The policyholder has moved abroad and assumes that the paperwork involved in migrating the money isn’t worth the effort.
It’s not always easy for insurers and investment companies to track down the rightful claimants, as people change jobs and move cities without giving any thought to updating their contact details. Corporate client databases may not be properly managed, or such companies may not give the proper priority to tracking down the owners of ghosted policies. However, companies are obliged to search for policyholders for at least three years after assets are categorised as “unclaimed”, as the funds in these policies cannot – by law – be paid out to anyone but the policyholder or beneficiary, irrespective of their current geographical location.
What does this mean for you? It’s quite possible that you could be one of the fortunate people with unclaimed policies in South Africa, just waiting for you to discover your windfall. If you’re not already asking yourself, “how do I find out if I have unclaimed money” back in South Africa?”, you should be!
Don’t delay. Although insurers and investment companies are obliged to spend three years searching for the policyholder or rightful beneficiary, ASISA (Association for Savings & Investments SA) rules state that once all reasonable efforts to trace the customer, heirs or beneficiaries have been exhausted, the assets may be used for socially responsible investments.
Fortunately, all is not lost if more than three years have passed since the funds became unclaimed. ASISA members have committed to honour unpaid claims at any point, regardless of how many years have passed, as long as you can prove you are the legal beneficiary of the claim.
Here’s what you can do if you think that you might be due funds from an unclaimed investment or insurance policy:
- Contact the insurer or investment company directly. Unfortunately, there is no central database to ascertain whether you’ve got an unpaid claim, or if you’re a beneficiary of an unclaimed policy or unit trust investment. Yes, this means you’ll have to contact all of them, if you don’t have the name of a specific company (You can find a list of the Association for Savings & Investments SA here and it’s recommended that you email companies instead of calling, as this way you’ll have a paper trail of all engagements.)
- Get ready to provide documentation to prove you’re entitled to your claim. Every company will have their own verification requirements for certain products, but if you’re looking for the policy of a deceased person, you’re likely to need their death certificate.
Does contacting each insurance company and investment company sound like a lot of hard work? It can be a lot of work – especially if you’re abroad and you’re trying to contact companies back home in South Africa. If there’s a time zone difference, it could take you a while!
Finglobal can help track down unclaimed funds due to you
Why don’t you let FinGlobal handle the hard work for you? We can help you track and trace any unclaimed insurance policies of which you might be a beneficiary. Sniffing down unclaimed policies in SA on your behalf is all part of our service and it’s something we’re really good at.
Once we’ve identified any funds which you are owed, we can then advise you exactly on how to migrate these funds abroad, what tax consequences you need to consider and the foreign exchange hoops you’ll have to jump through to see your money. We’re known for our fast, convenient service – so what are you waiting for? The sooner you contact us, the sooner your windfall could be landing in your offshore account.