No-one wants to think about the death of a loved one but it is inevitable that you will have to face this one day. While the process of managing the funeral is not something people enjoy, being prepared will make the event a lot easier for everyone concerned. Before we talk about preparing for a loss, let’s start with how you can get your financial affairs in order first. Going through the process yourself will make it easier to assist others.
Important Documents: Make copies of the following documents and give them to a trusted family member or friend along with your contact list: ID book, a certified copy of your passport, birth certificate, death certificates of family members, divorce documents, insurance policy and investment documents, short term insurance policies, medical aid, loans, employer contract. Now that you have your own affairs in order here is what you need to know if a loved one dies.
If the death is expected: If someone is very ill try and get their affairs in order before they die. Be aware that all of their bank accounts will be frozen so if the family needs money this should be taken into consideration. Make sure that they have a will in place and assist them if possible. While it is not the most pleasant question to ask at this time you need to establish if they have a funeral plan or a life policy. They also need to appoint an executor (more details on this later). If they have dependent children it is vital that a guardian is also appointed.
After the person dies you can contact the insurers to help you with the pay-out of the policy, you will need access to the funds to pay for the funeral costs. Then you need to appoint a funeral director. You do not have to accept a referral, take your time-choose the one that you are most comfortable with.
The funeral director will collect the deceased on your behalf. The funeral director will have the deceased moved to a suitable mortuary and acquire a Death Notice / Notification of Death and a BI-1663 Medical Certificate. This is different from the ‘Death Certificate’ you get from Home Affairs.
If a person dies in hospital after illness the doctor will issue a death notice. You will then be required to contact the funeral director immediately to collect the deceased. However some State Hospitals may have mortuary facilities and the body will remain there until a death notice is issued
If the cause of death was unnatural there will have to be a compulsory post mortem and in this case the state mortuary will then issue a death notice. Depending on the circumstances of death you may need to contact the police, if foul play is suspected the police will organise removal of the body to a State Mortuary where a post mortem will be performed.
Information for Organ Donors: There is acritical shortage of organs for donation in South Africa and if the deceased indicated that they are happy to be a donor their wishes should be respected. The Organ Donor Foundation manages the donation process and should be contacted immediately. Their website address is odf.org.za. or you can call them Toll Free on 0800 22 66 11.
Planning a Funeral: Hopefully you will have discussed hey type of funeral the deceased would have preferred i.e. a burial or cremation and the location. Once you have appointed a funeral director you will have to set up a meeting. You will need to take the following documents:
- A copy of the deceased’s Identity Document.
- Your Identity Document if you are arranging the funeral
- Funeral Policy details and contact numbers.
- Marriage certificate (a required by the insurance company).
- Clothes for the deceased.
A funeral director will usually handle almost all aspects of the funeral. They will get the death notice from the medical facility, register the death at Home Affairs and collect the death certificate.
They will then assist you with the choice of a coffin and prepare the deceased. They can help with cemetery or crematorium bookings and assist with transport of deceased. Depending on the type of funeral and your customs you need to also plan the style of the funeral. You may have to plan for all or a mix of the following: Catering and venue, song sheets, a photograph/s of the deceased, flowers and music.
The Costs : If you have a funeral policy you can give a copy of the policy to the director to verify. They will usually require the money up front. The cost of a funeral can be as little as R8000 and the upside is unlimited depending on the wealth of the family. Traditionally people get into a lot of debt to have a large expensive funeral. This is not a sensible thing to do; the deceased would not want you to be financially stressed on their account. You should be sensible about the costs and to avoid getting yourself into financial difficulty.
After the funeral: You will usually receive a Death Certificate from Home Affairs within a month of the death being reported. If you are the Executor you will need to take the original of the Death Certificate with at least 10 copies to a police station to be certified. As an executor it will be your job to close all the deceased accounts and the institutions will require a copy of the Death Certificate.
The Will: Some people nominate their bank to be the executor of their estate. An executor is the person responsible for making sure the deceased wishes are carried out, their accounts and affairs wound up and their possessions and money distributed to the correct people. However not all banks will take on an executorship if the estate has a low value. They will then refer you to their lawyer network for assistance. If the person dies the without a will The Master of the High Court will appoint an executor.
If you are appointed as an executor you must feel confident that you can carry out the obligations because it can take a lot of time and effort. It is advisable to appoint an attorney or an accountant to assist you. As an Executor you are entitled to a fee of 3.5% of the gross value of the assets.
The duties of an executor: After the death, the executor should meets the family to receive all documents of ownership, banking details, assurance policies etc. He gathers all the necessary information to report the estate to the Master of the High Court. There are several statutory forms that need to be filled in, and these, together with the will, are lodged by the executor with the Master.
The Master then issues Letters of Executor ship in favour of the executor. Until the executor has this, he has no formal authority to act on behalf of the estate. The executor can start gathering information and arrange for the valuation of assets, but he does not have the ability to dispose of assets, or collect any cash due to the estate. It is over this initial period of three to four weeks that the estate is “frozen”.
Pending the receipt of the Letters, the executor would have made contact with the beneficiaries, advised them of procedures and obtained instructions regarding the disposal of estate assets. While the executor has the ability to deal with the assets, he must always act according to the beneficiaries’ instructions.
The executor places a notice in the local press and in the Government Gazette calling on all creditors to lodge their claims against the estate within a specified time, normally 30 days. The executor also shows the Letters to all the institutions where estate documents or investments are held. He then starts calling in cash, redeeming investments, collecting the proceeds of insurance policies and selling assets the heirs wish to sell.
A bank account is opened in the name of the estate into which such funds will be deposited. Once the executor is satisfied that the estate is solvent, he tries to settle all creditors’ claims against the estate as speedily as possible.
Before distributing the estate the executor must obtain a release from SARS and all creditors must be paid before the assets or money estate can be distributed to beneficiaries.
Once the executor proves to the Master of the High Court with that the creditors have been paid and that the assets have been distributed, the Master signs will sign off the estate and the process is complete.
It can take ten months to three years to finalise an estate and this is why a good funeral plan and life policy is such a valuable investment. It can tide over the heirs until all the legal issues are dealt with and the estate is wound up. It is a small price to pay for enormous peace of mind.