An article in the latest issue of Insurance Gateway may be of great value to both advisers and their clients.
It appears that there is an estimated R20bn in unclaimed benefits across 3.5 million policy holders in South Africa.
“Metropolitan recently took significant steps to disrupt this market by using an unconventional tracing method that’s already yielding a relatively higher success rate in finding beneficiaries.”
In partnership with Colab, and using their fintech products, FindBen and PayBen, Metropolitan is the first large insurer to roll out this proprietary model to the local market.
Deidre Wolmarans, Head: Life Events Solutions at Metropolitan, reports that “just one exercise in this new partnership enabled us to find 18 140 beneficiaries and to pay out R20 million securely, quickly and more efficiently than before”.
She says “the primary motivation for the new approach is simply to do the right thing by our clients by paying the money due to them”. She also notes that unclaimed benefits are a potential burden on company balance sheets as ASISA regulations ensure that companies can never take ownership of them nor of any interest accruing.
According to Wolmarans, there are several reasons why advisers should join in this process: “It’s a chance to be pro-active and to maybe deliver an unexpected windfall for clients while also helping them to consolidate their financial plans and, possibly, to provide them with additional investment solutions.”
She details actions that advisers can take about unclaimed benefits;
- Run a proactive check against a client’s ID number with any financial services provider they have had a policy with in the past.
- Do the same for any next of kin who passes away – the unclaimed benefits might accrue to the client.
- Make clients aware of residuals and encourage them to ask questions of their providers.
- Conscientiously update client data on a regular basis.
- Inform clients about the importance of properly registering a change of address.
Wolmarans says the new approach is about being truly client-centric and Colab CEO Will Green says that informed the entire pioneering project: “We began by defining these funds as ‘unpaid’ instead of ‘unclaimed’ and the hard work that followed is now paying dividends.”
She admits that the project team often have to overcome a client’s fear of being scammed: “some will believe this is too good to be true but we get around this by sending them to the nearest Metropolitan branch where they can get reassurance and make arrangements for the transfer”.
Well done on this initiative, Metropolitan.