Ever imagined that you will be paying for your own funeral?

Most people do not like to contemplate their own mortality although it is fact of life that each one of us will have to encounter - some sooner than others. Our own death is a certainty
that can drain our loved ones, both emotionally and financially. This is especially so if the death was unexpected. Given the rising cost of living, funeral expenses can also be quite high, dependent on the cultural and religious rites that need to be observed. In some cases, these will mean several thousands of dollars being spent. Who actually, contributes to these? Usually, it is the dependents or immediate family members of the deceased.

But all this will now change - with the new policy from the FijiNational Provident Fund that will allow its members to use part of their savings for their own funeral expenses. The new FNPF policy allows for nominees under the Memorandum of Administration to access the member’s Special Death Benefit (SDB). This is only on the condition that the SDB premium has been deducted up to the current year. The SDB currently sits at $8500 while the annual premium of $35 is debited from the member’s account.

How does the SDB work?
Currently, if a member dies with a balance of $40,000 in his account, the Fund will add $8500 to his account and then distribute $48,500 to his nominees. With the new policy - the Fund will now deduct $2000 from his SDB for his funeral expenses, and then pay the remainder to his nominees. In this case, $46,500 ($40,000 + ($8500 - $2000) will be distributed.

Paying for your own funeral after years of sweat and toil may not be such a bad thing as it first and foremost alleviates the financial burden on your loved ones. Such a policy by the Fund raises many-a-reason to stop procrastinating and allows you also the opportunity to plan your final rites upon your demise. It will also introduce a new culture and attitude for the working populace toward funerals and savings. In a time when the savings culture is being promoted through Financial Literacy programmes, this policy couldn’t be more apt.

In the last few years, members of the Fund were permitted $1000 to $1500 for immediate family members for funeral assistance. While the funeral assistance scheme continues for members whose immediate relatives are not members of the FNPF, the new policy tends to the members’ final needs. The next of kin or MOA nominee can apply for the partial payment of the SDB only if the deceased is an eligible member of the Fund.

Eligibility depends on the upto- date payment of the SDB premium. It is now also the members’ prerogative to ensure the premium is updated. Payment also depends on whether the Memorandum of Administration was filed by themember. The MOA will only be valid if all the requirements are in order. Only in the absence of a valid MOA, payment will be made to a next of kin as per approved FNPF policy. This will either be the spouse; if unmarried or divorced or a single parent with minor children, the parents; or the member’s adult children or the member’s adult siblings if the member was single, a single parents or if the member was married with minors or no children and spouse and parents are deceased.

The assistance will only be for the member’s funeral expenses and cannot be accessed for any other expenses related to the member.

What do FNPF members need to do?
Members will need to complete the FNPF Memorandum of Association (MOA) Form. The form:

• Allows you to nominate a person that will administer the $2000;
• Authorises the Fund to pay the $2000 from the SDB to the person nominated by you; and
• Will be available from all FNPF branches and agencies from Jan 1, 2011;

In filling the MOA form, members will also need to provide:

• Member’s latest birth certificate; and
• The latest birth certificate of the person nominated by you (executor);

Who can apply for these funds?
Persons nominated by the (deceased) member under the MOA.

Important to note:

• Members need to fill this form to allow the Fund to pay the $2000 to the person nominated by you; and
• In the absence of a valid form, then the Fund will decide who will receive the $2000 based on FNPF guidelines.

Requirements for those applying for these funds?

• Complete FNPF Application Form 9B4 (can be obtained via the website and/or at any branch and agency Fiji wide from January 1, 2011);
• Certified copies of the notice to the undertaker or medical certificate of cause of death, stamped and signed by the hospital medical superintendent/ SDMO prior to burial/cremation;
• Police order for burial only when assistance is sought before date of burial;
• Death certificate issued by Registrar of Births and Deaths if burial has taken place as in the case of outer islands;
• Evidence of relationship of deceased to the applicant;
• Completed ‘Additional Information’ Form;
• Deceased member’s original birth certificate; and
• Nominated person’s latest bank statement

The nominee or next of kin can only apply for the assistance within 20 working days from the time of death. Once all requirements are fulfilled, payment will be released to the nominees’ bank account.

Funeral assistance for the death of a non-FNPF member
The current funeral assistance policy will apply for non- FNPF members. Members can apply for their immediate family (parents, spouse, sibling and children) if they are not members of the Fund and/or ineligible for SDB payment. The amount that can be accessed for such assistance is capped at $1000.

What the Fund says:
Chief executive officer of the FNPF Aisake Taito says the funeral assistance through SDB should benefit the members by eliminating the financial burden from their loved ones and it also ensures that the final rites of the member is decent and respectable with the amount for withdrawal increased to $2000.

“The introduction of the Partial Withdrawal of $2000 from the Special Death Benefit for the members’ funeral expenses is part of the on-going changes the Fund has embarked on,” Mr Taito said.

“There will be more changes announced to its withdrawal policies as the Fund moves towards realigning itself to its core objectives of ensuring members are financially secure upon retirement.”