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Easy Beneft Plan

Old Mutual SuperFund


Bryan Daniels
GLASS MANUFACTURER
EASY TO USE OFF-THE-SHELF SOLUTION
Why it works for my business:
What you see is what you get much like pre-paid airtime, Easy
Beneft Plan is easy to understand and easy to administer.
Its not only uncomplicated, its also very affordable.
Its no frills approach works for any type of company.
Plus for under R100 my employee gets a lot of cover!
For example, R85 contribution buys:
R14 400 death cover (if younger than 50 at death)
or R9 600 (if aged 50 or older at death).
R14 400 lump sum disability beneft (if younger than 50)
or R9 600 (if aged 50 or older).
R800 per month temporary disability income beneft, payable for a
maximum of 5 months in any 24-month period.
R7 500 family funeral beneft (cover for children is age-dependent).
I needed something simple and affordable. Easy Beneft Plan is
pre-packaged, so there were no beneft design decisions to be
made. It includes a disability income beneft as well as family
funeral cover, with no time-consuming medical tests required.
Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
Easy Beneft Plan
Old Mutual SuperFund
More about Easy Beneft Plan
The Fund is set up to provide members with retirement savings and cover for permanent
disability and death.
80% of permanent employees must join (with a minimum of 5 employees).
The Fund pays a beneft in the event of resignation, retrenchment, dismissal or retirement.
The temporary disability income beneft helps the employer pay a portion of the employees
salary during an extended absence due to ill health or incapacity.
The lump sum disability beneft pays a beneft in the event of the employee being assessed as
permanently disabled (no waiting period applies).
The family funeral beneft pays a beneft in the event of the employees death or the death of an
immediate family member of the employee.
The Funeral Support Service provides the immediate family (i.e. spouse and children) of the
deceased with support such as transportation of the deceased, legal advice, etc.
How it works
Every month the employer pays the total contribution in respect of the employees to
the Old Mutual SuperFund Provident Fund. This equates to 8.5% of their retirement
funding income and is allocated as follows:
5.2% (less R22.50 [includes VAT] monthly member administration fee) goes
towards the employees retirement savings.
1.75% goes towards the lump sum disability and death benefts.
0.75% is paid to separate insurance policies that provide temporary disability
income and family funeral benefts.
0.8% covers various fund expenses.
Plus employees can transfer existing retirement fund money that they have
accumulated with a previous employer (tax-free, if from another Provident Fund).
Plus the employer and employees can make additional voluntary contributions.
The benefts, contribution allocations, fees and insured beneft costs are reviewed
annually in January.

Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
Accumulated credit
The accumulated credit is used to provide the employee with benefts on:
Retirement (ill-health, early, normal and late retirement).
Resignation, retrenchment and dismissal.
Death.
Disability.
An employees accumulated credit is equal to:
The money that the employer has paid on behalf of the employee towards retirement
savings, plus
Any voluntary contributions made by the employee and/or the employer on behalf of the
employee, plus
Any amounts transferred from other retirement funds on behalf of the employee, plus
Investment returns, less
Expenses
Investment Portfolio the employees accumulated credits are invested in the Old Mutual
Absolute Stable Growth Portfolio.
This portfolio is a smoothed bonus portfolio and explicitly targets returns in excess of infation
over rolling 3-year periods, while signifcantly reducing the ups and downs associated with
market-linked investments. The Absolute Stable Growth Portfolio also provides investors with
an 80% capital guarantee.
The returns are passed onto employees accumulated credits via monthly bonuses which
are declared in advance. These bonuses are net of capital charges of 0.70% per annum and
investment management fees of 0.65% per annum (i.e. all fees and charges have been
deducted before a bonus is declared).
Monthly member administration fee a monthly administration fee of R22.50 (includes
VAT) is deducted from each employees accumulated credit to cover the cost of administering
the member account (including claims processing, member communication, reporting, etc),
as well as the ongoing management of the Fund (audit, trustee, consulting, FSB levies, bank
charges, etc). This fee is reviewed annually in January.
Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
Beneft payable on retirement
On retirement, the employee will be paid a beneft equal to his/her accumulated credit at that
time. The normal retirement age is 65 years, but an employee can retire at any time after age
55 years, subject to his/her conditions of employment.
The employee can purchase a monthly pension with the full accumulated credit, or he/she can
take any portion as a cash lump sum and the remainder used to purchase a monthly pension,
or the full accumulated credit in cash.
The beneft is subject to taxation when it is taken in cash. If a monthly pension is purchased,
the monthly pension is taxed.
To help retiring employees with a hassle free transition into retirement, they have the option
of electing the Old Mutual Fund Select Annuity, when deciding on their full or partial monthly
pension purchase. Old Mutual Fund Select Annuity is a generic best ft annuity for retiring
members, and is endorsed by the Trustees of the Old Mutual SuperFund. The annuity option
available has standard features and is based on a favourable annuity rate basis negotiated by
the Trustees.
Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
Beneft payable on resignation, retrenchment or dismissal
If an employee leaves the service of the employer through resignation, retrenchment
or dismissal, he/she is entitled to a withdrawal beneft equal to his/her accumulated
credit at that time.
The employee can transfer their beneft tax-free to another approved retirement fund,
including a retirement annuity or preservation fund. Or they may choose to have the
beneft paid as a cash lump sum, subject to taxation.
Temporary disability income beneft
If an employee becomes totally unable to work, he/she may become eligible to receive
disability benefts.
If after a waiting period of one month an employee is still unable to work, and the claim is
approved by the insurer the temporary disability income beneft will pay a monthly amount
(equal to 80% of annual retirement funding income) to the employer for a maximum period
of 5 months. The employer will then pay this beneft (after deducting any income tax) to the
employee.
During the period whilst the temporary disability income beneft is being paid, the employee
continues membership of the provident fund and enjoys cover for all the other insured risk
benefts. The employer will continue to pay contributions on behalf of this employee at the
defned rate of 8.5% of their retirement funding income.
Should the employee return to work during this period, the temporary disability income beneft
will cease.
AN EMPLOYEE IS PROTECTED
IF HE/SHE IS TEMPORARILY OR
PERMANENTLY UNABLE TO WORK
Lump sum disability beneft
If the employee is found to be permanently disabled and the claim has been accepted by the insurer,
the Fund will pay the employee a beneft equal to:
The employees accumulated credit plus
The insured lump sum disability beneft.
Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
Death beneft
If an employee passes away while still in your employment, the Fund will pay their
dependents, as determined by the Trustees of the Fund and in proportions that the
Trustees decide, a beneft equal to:
The employees accumulated credit plus
The insured death beneft.
Family funeral beneft
In the event that the employee or an immediate member of their family (i.e. spouse or
children) passes away, a family funeral beneft is paid to the employer. The employer will
then pay this beneft to the employee or the employees family.
Funeral Support Service Employees have access to this
service at no additional cost
Transportation of the deceased from anywhere in the world to the fnal funeral home
within South Africa and neighbouring countries.
Transportation and accommodation for one family member accompanying the
deceased where death occurs within South Africa.
Discounted funeral packages (of up to 35%) with a network of funeral service
providers.
Legal assistance can be arranged to assist with interpreting the Will of the deceased.
Advice on all necessary documentation such as obtaining a death certifcate and
cross-border documentation.
Referral to a pathologist if an autopsy is required.
Referral to a psychologist or psychiatrist for trauma counselling.
Referral for special counselling relating to the loss of a child.
Referral to undertakers and providers of other funeral services, such as caterers and
providers of tents.
Assistance in fnding a tombstone provider.
Principal members and their immediate family can contact the Funeral Support
Service Call Centre on 0860 000 500, 7 days a week, 24 hours a day in all
11 offcial languages.
Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
SuperFund adding value
Old Mutual Financial Wellbeing Program At no additional cost a solution for employees
providing all levels of staff:
Financial education.
Access to advice.
Retirement savings
Contribution breakdown
Beneft categories Type of beneft Contribution
Retirement Provident 5.20%
Scheme expenses 0.80%
Insurance provided through
retirement fund
Group life assurance.
Lump sum disability beneft.
TOTAL
1.45%
0.30%
1.75%
Insurance provided outside the
retirement fund
Temporary disability income.
Family funeral beneft.
TOTAL
0.17%
0.58%
0.75%
Total 8.50%
Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
Core cover (compulsory) Voluntary cover
Employer paid retirement
savings
5.2% of retirement
funding income
Plus Employer paid retirement
savings
Employer decides on
amount of voluntary
contributions, if any
Employee paid retirement
savings
Employee decides on
amount of voluntary
contributions, if any
Employer paid insurance 2.5% of retirement funding income
Employer paid scheme expense fees 0.8% of retirement funding income
Benefts at a glance
Beneft
categories
Type of
beneft
Cover Special
conditions
Legal
vehicle
Retirement Defned contribution
provident fund
Old Mutual Absolute
Stable Growth
investment portfolio
Bonuses declared
monthly in advance.
80% guarantee level
Retirement fund
Injury & incapacity Temporary disability
income
80% of annual
retirement funding
income paid as a
monthly beneft
Payable for a
maximum of 5
months in any 24
month period
Maximum annual
retirement funding
income is R180 000
1 month waiting
period
Pre-existing conditions
(6/12 months)
Insurance policy
outside the
retirement fund
Lump sum disability
(LSDB)
Age <50:
1.2 times annual
retirement funding
income
Age >50:
0.8 times annual
retirement funding
income
Maximum annual
retirement funding
income is R180 000
Pre-existing
conditions
(24/24 months)
Beneft reduces by
1/60th every month
between ages 60 and
65 years
Retirement fund
Death Group life assurance Age <50:
1.2 times annual
retirement funding
income
Age >50:
0.8 times annual
retirement funding
income
Maximum annual
retirement funding
income is R180 000
6 months exclusion
except for accidental
death
Retirement fund
Family funeral R7 500:
Member, spouse, child
aged 14-20 years
R3 750:
Child aged 6-13 years
R1 500:
Child aged less than
6 years (includes
stillborn)
6 months exclusion
except for accidental
death
Insurance policy
outside the
retirement fund
Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
Taxation of contribution and benefts
Beneft
categories
Type of
beneft
Contribution
paid by
Taxation of
contributions
Taxation of
benefts
Retirement Defned contribution
provident fund
Employer:
Compulsory 5.2% of
retirement funding
income
Employer
contribution: Fully
tax deductible by the
employer
Taxable in the hands
of employees (certain
tax concessions
apply)
Employer:
Voluntary (employer
decides on amount)
Employee:
Voluntary (employee
decides on amount)
Employer
contribution:
Fully tax deductible
by the employer
(subject to certain
limits)
Employee
contribution:
Not tax deductible
Taxable in the hands
of employees (certain
tax concessions
apply)
Injury & incapacity Temporary disability
income
Employer Fully tax deductible
employer expenses
(section 11(a) of
Income Tax Act)
Beneft paid to
employer, who in turn
pays to employee
Tax neutral in hands
of employer
Beneft must be
refected in gross
income and is taxable
Employer obtains
income tax deduction
in terms of section
11(a) of Income Tax
Act
Taxable in the hands
of employees (certain
tax concessions
apply)
Lump sum disability
(LSDB)
Employer Fully tax deductible Taxable in the hands
of employees (certain
tax concessions
apply)
Death Group life assurance Employer Fully tax deductible Taxable in the hands
of employees (certain
tax concessions
apply)
Family funeral Employer Employee policy with
employer making
payment on behalf of
employee
Employee is required
to pay fringe
beneft tax on the
contribution amount
Taxable in the hands
of employees (certain
tax concessions
apply)
Tax-free in the hands
of the benefciary
Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
Expenses and fees
Scheme expense fee 0.8% of retirement funding income.
Covers various expenses such as administration,
distribution and brokerage costs.
Member administration fee R22.50 (inclusive of VAT) per member per month
(reviewed annually in January).
Deducted from members retirement savings.
This is already included in the normal employer
contribution rate of 8.5% of retirement funding
income and covers the cost of administering the
member account (including claims processing, member
communication, reporting, etc.), as well as the ongoing
management of the fund (audit, trustee, consulting,
FSB levies, bank charges, etc.).
Investment fee Deducted monthly.
(Old Mutual Absolute Stable Growth Portfolio) Capital guarantee charge of 0.7% per annum.
Investment management and administration fee of
0.65% per annum.
Easy Beneft Plan is part of the Old Mutual SuperFund range of solutions
Old Mutual Corporate is a division of Old Mutual Life Assurance Company (South Africa) Limited, Jan Smuts Drive, Pinelands, 7405, South Africa.
Registration no: 1999/004643/06. A licensed fnancial services provider authorised in terms of the Financial Advisory and Intermediary Services
Act, 2002, to furnish advice and render intermediary services with regard to long-term insurance and pension fund benefts, as well as providing
intermediary services as a discretionary investment manager. Please note that this license does not cover the marketing of this product by persons
other than Old Mutual and its staff. This document has been written for easy reading. Every effort has been made to ensure that this document
and the products referred to, meet the statutory and regulatory requirements, pertaining to the manner and format in which information regarding
fnancial products is presented. However, should you become aware of any breach of such statutory and regulatory requirements, please address
the matter in writing to: The Compliance Offcer, Old Mutual Corporate, P O Box 728, Cape Town, 8000, South Africa.
Contact your Old Mutual Personal Financial Adviser, your Intermediary, or an
Old Mutual Corporate Consultant in your area for more information or advice.
Visit our website at www.oldmutual.co.za/EasyBeneftPlan
Old Mutual Corporate Old Mutual Corporate
Intermediary Consultants Direct Consultants
Johannesburg 011 217 1990 / 1249 011 217 1990 / 1537
Pretoria 012 360 0000 / 0001 012 360 0000
Western Cape 021 530 9600 / 9615 021 509 1098 / 504 6538
KwaZulu-Natal 031 275 0800 031 275 0800
Eastern Cape 041 391 6300 / 6319 041 391 6300
Bloemfontein 051 505 2991 051 505 2991
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Get Old Mutual Easy Beneft Plan for your business and employees today.
Easy Beneft Plan is uncomplicated and affordable
its perfect for the small employer.