Employee Benefit Funds

Verso Umbrella Retirement Funds

Umbrella Fund arrangements are structured solutions for small to medium funds that allow many unrelated employers to participate in one overall legal retirement fund structure, while at the same time defining their own terms of participation and risk benefits. This provides a professionally managed and cost effective alternative for clients who do not want the fiduciary responsibility that comes with the management of a private fund, or who lack the knowledge or time to effectively apply themselves as a Trustee of a fund.

The main differences between private and umbrella funds can be summarised as follows:

Private Funds Umbrella Funds
  • A Board of Trustees must be appointed to perform fiduciary duties and manage the Fund.
  • Professional Trustees are appointed to manage the fund as a whole.
  • Trustees are liable in their personal capacity and take full responsibility for the management of the Fund.
  • The participating employer appoints a Management Committee, which has no fiduciary duties or responsibilities, to make decisions within the Fund framework.
  • A Principal Officer must be appointed.
  • There is no legal obligation to appoint any fund officers.
  • The Trustees appoint an Auditor and Valuator for the fund. The total cost for these services is payable by the fund over and above the normal administration fee. As private funds usually have fewer members than umbrella funds, the fee per member can be high.
  • The Trustees appoint an Auditor and Valuator for the fund. The cost is again payable over and above the normal administration fee, but as it is split between all the participating employers, the fee per member is usually cost-effective.

It is possible to convert existing private funds to umbrella funds. If you would like to consider this option, please contact us for a full market survey comparing costs and benefits.

For more information on our umbrella funds, please go to www.vurf.co.za.

Verso Low Risk Umbrella Funeral Scheme

Our Umbrella Funeral Scheme, developed in partnership with Hollard Life, provides qualifying participants with a range of market-related benefits at very competitive premiums. The scheme provides a cash funeral benefit, on a sliding scale, on the death of the member, his or her spouse and/or children (subject to certain conditions).

Verso Unclaimed Benefits Preservation Funds

In 2008, amendments to the Pension Fund Act and the new Revenue Laws Amendment Act created a new framework for the handling of unclaimed benefits, which previously in most cases had reverted back to the fund.

Verso’s Unclaimed Benefit Pension Preservation Fund and Unclaimed Benefit Provident Preservation Fund have been established to enable funds to manage their unclaimed benefits in accordance with the new rules. They are managed by an independent Board of Trustees.

These funds will receive the unclaimed benefit either on a tax-free basis, if accrual was after 1 March 2009, or on a partly taxed basis if accrual was before 1 March 2009. The unclaimed benefit will be held in a “member share account” and any amount previously taxed will be recorded accordingly. The member share account will operate on a defined contribution basis and fund returns will be allocated to the member share account. The fund expenses will be recouped on a pro-rata basis from each member. The benefit will be paid out on a satisfactory claim (withdrawal, retirement, death) from the member.

Verso engages actively in trying to trace members who have unclaimed benefits.