If you want your superannuation fund to give your superannuation and life insurance to your loved ones, you need to nominate them on a Binding Death Benefit Nomination Form.
You must also receive a confirmation from your superannuation fund that the form is valid.
We are finding that superannuation funds have recently become strict when it comes to these forms. Consider the following:
– You have nominated your parents to receive your super
– You have nominated your sibling to receive your super
– You have not added your loved one’s address or date of birth
– You have not added your relationship with the beneficiary (ie spouse)
– You have ticked a box when it should have been crossed
– The form is not signed in front of two witnesses
– You used blue pen when it should have been black pen.
The superannuation fund will either reject the form and notify you, or reject the form and not notify you.
The latter is what has happened to a deceased. We act for the Executor (we didn’t act for the deceased).
The Executor and his loved ones were expecting payment of mum’s superannuation and life insurance to them.
Instead they were greeted with a raft of documents – much of it legalese.
Without a binding death benefit nomination, the superannuation fund is obliged to consider who was a dependent on the date of the deceased’s death.
The super fund is required to investigate whether there were also any interdependent relationships and this could take time and lots of paperwork. All the while the money is held with the superannuation fund generating income (but not to your benefit).
If you want to see if you have a binding death benefit nomination, call your super fund, check online or check your recent statements.