FSA2013: Consent or no consent?

This is a short excerpt from my blog post yesterday on the Financial Services Act 2013:

“I am saying this because the policy owner have to understand when consent is needed from the new trustee and when consent is not needed. For example, there are certain circumstances which still do not require the new trustee’s consent when a nomination is changed.”

Let me offer you four examples of insurance nominations, as related by Rockwills Trustee Berhad at a presentation to us Rockwills Estate Planners on the new FSA2013.

Case One: Policy owner originally nominated wife to receive 50%, son to receive 25% and daughter to receive 25%. Policy owner now wants to remove wife and replace with mother. Consent is needed as the mother is other than a spouse or child.

Case Two: Policy owner originally nominated wife to receive 50%, son to receive 25% and daughter to receive 25%. Policy owner and wife now divorced, wants to remove ex-spouse and replace with new wife. Consent not needed as the new wife is now considered as his spouse.

Case Three: Policy owner originally nominated wife to receive 50%, son#1 to receive 25% and daughter to receive 25%. Policy owner now wants to wife’s share to 30% and give the 20% to son#2 who is illegitimate. Consent not needed as long as can be proofed that son#2 is his child.

Case Four: Policy owner originally nominated wife to receive 50%, son#1 to receive 25% and daughter to receive 25%. Policy owner now wants to remove wife’s share and increase son’s share to 50% and daughter’s share to 50%. Consent not needed because these are still the same groups of people, that is, spouse and children.

However, we were cautioned that this was only Rockwills interpretation and policy owners should seek the final advice from their insurance companies as each company may still look at the FSA2013 differently.

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