Old Mutual on track to implement Statement of Intent
Old Mutual welcomes the decision by the Life Offices Association (LOA) today to recommend implementation of the Statement of Intent aimed at enhancing values of qualifying policies. Old Mutual is on track to meet the implementation dates that have been agreed with National Treasury.
"We have already updated our systems to apply the agreed minimum fund values to the vast majority of qualifying retirement annuity, provident fund and endowment policies affected by policy changes (such as surrenders, premium reductions, lapses, early withdrawals) after 1 December," says Old Mutual Deputy MD Peter De Beyer.
The agreement with National Treasury also stipulates that within six months from 1 December 2006, all qualifying retirement annuity, provident fund and endowment policies affected by policy changes in the six year period between 1 January 2001 and 1 December 2006, which are still on the books of the insurer, must be enhanced to the agreed minimum values. "We are working hard to ensure that these enhancements, which will be done automatically, are effected within this time frame," says De Beyer.
The same value enhancements will apply to eligible retirement annuity and provident fund policies which have lapsed during the past six years. However, in these instances, clients must apply for the value enhancements. "At this stage, affected members are not required to do anything. Old Mutual will publish advertisements in the first half of 2007 advising members where and how to apply."
Continuing policies through to maturity
De Beyer urges members not to mistake this initiative as a signal that there are no consequences for cancelling their policies early or stopping their premiums. "It still remains true that it is almost always in a cli ent's best interests to continue his or her policy through to maturity."
