Question:
What are the maximum charges allowed in terms of regulations on early termination of a retirement annuity due to emigration? Trying to do an early termination of an older policy (the ones that have a guaranteed minimum benefit and allow changes to premium amounts) and the Insurer is trying to recoup future premiums and expenses as well as a disinvestment fee but they are refusing to use the guaranteed minimum benefit as a starting point for calculations?
Answer:
Kerry, The maximum penalty depends on when the retirement annuity was taken out. For older retirement annuities, the maximum penalty is 30% of fund value, but for retirement annuities taken out after 1 January 2009, the limit is 15% of fund value.
The information and answers supplied in this section do not constitute advice as defined by the Financial Advisory and Intermediary Services Act, 37 of 2002.
