Understanding the Board of Trustees' Role in Beneficiary Claims

It's a common misconception that a member's last will and testament dictates how their pension fund death benefit will be paid out. In South Africa, this is not the case. The Board of Trustees of the retirement fund is the sole authority responsible for distributing the benefit. Their decisions are legally bound by Section 37C of the Pension Funds Act, 1956, which requires them to identify and distribute the funds equitably among the deceased member's dependants and nominated beneficiaries. The death benefit is considered a social security benefit and, therefore, falls outside of the deceased member's personal estate, protecting it from creditors and other claims. The Board's primary duty is to ensure that the funds are paid to those who were financially dependent on the member, fulfilling the purpose of the retirement fund.