• Interest on late payments – funeral policy – late payment of benefit to the nominated beneficiary.
The complainant was the beneficiary under a policy where his daughter was the life assured. She died in December 2001, but payment was only made by the administrator in November 2004.
We referred the insurer to an arrangement between the office and the LOA in respect of interest on late payments: “If the Life Assured died on 11 December 2001 but payment of the capital sum was only made on 10 November 2004, should interest on the capital sum not be calculated and paid?
Prima facie it appears to us as if interest on the capital sum should be calculated from the date 60 days after 11 December 2001 to the date of payment at the Standard Bank’s rate for 12 months deposits.”
The insurer responded by confirming that it had calculated the interest on the lines suggested and had paid the amount so calculated into the beneficiary’s account.