How Deep Is Your Love?

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I think most of us would have noticed that one of the news which made headlines recently was the staggering amount of more than RM 5 billion which remains unclaimed by Malaysians. It was reported that these unclaimed money are from inactive bank accounts, unclaimed fixed deposits that have expired, insurance payouts and interest. Insurance itself has more than RM 327 million which is due to beneficiaries of Life Insurance policies.

According to the Deputy Finance Minister, all these money are being held in Trust by the Registrar of Unclaimed Moneys in the Accountant –General’s Department. While reading this report, it prompted me to asked what about EPF money. As I remember, it was reported in the year 2015 that there was more than RM 422 million unclaimed in EPF funds. I presumed that these figures must have increased by now. So, your guess is as good as mine as to how these money are going to be utilized if it remains unclaimed. Based on these figures, have you asked yourself whether you have anything to claim from this pool of money.

If you are uncertain, it’s always best to check because it really puzzles me on what had happened to all the claims by beneficiaries despite the ongoing campaign by different departments on the awareness of nomination. Such substantial amount unclaimed may point to the fact that maybe many family members are unaware of such claims which they are entitled to or maybe they are having a tough time withdrawing these money.

Speaking about tough time withdrawing these money reminds me of a real life situation not long ago. It happened to a friend of mine. His story was about his brother who died without nominating any beneficiary in his EPF. So, I told him that since his brother died without a will, then his family would have to apply for a Letter Of Administration (L.A.). In reply, he said the process can be tedious because his brother died leaving behind his only son in his mid-thirties and is mentally retarded. His wife died more than twenty years ago. He further said that he is the only surviving sibling and expected to be the caregiver of his nephew. After hearing that, I advised him to engaged a lawyer to assist him in applying for the L.A. in order to withdraw the EPF money.

In his case, what I have observed was the tedious process of extracting the death certificates of the deceased wife and parents before applying for L.A. Under the Malaysian Distribution Act 1958 (amended in 1997), the deceased lawful beneficiaries are his wife, son and parents who are entitled to the distribution of ¼, 2/4 and ¼ respectively. To proof that his wife and parents have passed away, there must be proof of their death certificates. This eliminates the distribution of ¼ to each of them. So, the only family members who can extract the death certificate of the wife would be the husband and children. This would be tough knowing their circumstances. So, my friend has no choice but to rely on a lawyer to extract the death certificates for both the wife and parents who died long ago. I was told that the duration for applying the L.A. was lengthy.

Not long after that, I encountered two cases again which also involves nomination. But this time around, it was the Insurance policies. The first case was about a lady who died without nominating anyone. Apparently, when the insurance was sold to her, she was asked to nominate her nominee on numerous occasion. However, for some reasons unknown, this was not done. So, the only way to obtain the money would be applying for the L.A because she died without a will. Now, in her case, it was again the issue of the death certificate of her parents who have died long ago. The only family member who can apply for her parents death certificate at that point of time was her sister. But the problem was she was paralyzed and bedridden. So, the other avenue is to engage a lawyer in which the family refused to do so. With their refusal, their claim was stuck at that time.

The second case was of a similar nature in which an elderly lady who passed away without nomination and a will. She leaves behind four surviving sons. One of the sons is a bankrupt while another son went missing for years and could not be located. So, when this family apply for the L.A. , the first thing they have to do is get consent from all the sons to the appointment of Administrators. So, the challenge for them was to locate the missing son.

Even though I could only highlight a few of these cases, I believed that there must be thousands of cases out there in a similar situation that has created the staggering amount of more than RM5 billion to be unclaimed. With these kind of news and real life stories , I think it is a wake up call for all of us to ensure that we must do our nomination for EPF and Insurance money. By nominating your family as nominees, you are assured that your family members will received the money without any hassle upon your demise. But if you are worried on what happens if your nomination fails, then do a Will to protect it. One example of nomination fails in Insurance and EPf is when your nominees predeceased you and you have forgotten to change your nomination during your lifetime. Another example would be a common disaster between you and your nominees.

By drafting your will and mentioning your Insurance and Epf money in it can also alert the Executor/Trustee of the existence of these funds. Furthermore, your family does not require go through the hassle of extracting death certificates of lawful beneficiaries or looking for missing beneficiaries as mentioned when they apply for a Probate (Died with a Will). What you can do in your will with regards to Epf and Insurance money is to named your substitute beneficiaries if your nomination fails. For instance, if you have nominated your spouse as your nominee in your Epf and Insurance, then state in your will who shall be the substitute beneficiaries if this nomination fails. If the substitute beneficiaries are minors, then you have to give clear instruction that the amount collected by the estate must be placed under the “Testamentary Trust” in your will so that the Executor/ Trustee of your estate can distribute it progressively to fund for their Living, Education and Medical Expenses.

I would like to emphasized that the instructions of distribution to minors and children of special needs to be very clear for the Executor/Trustee to carry out their responsibilities. Therefore, your appointment of Executor/Trustee and guardian or caregivers especially for minors and special child is very important and crucial. Please think about it carefully and discuss with your family especially your spouse before making a decision on your choices. Allocating time to deal with the issues highlighted really depends on “How Deep Is Your Love” ?


For more information or for any inquiries you may contact me at :

Tel : 012-5078825 / 05-2554853
Address: No.108(2nd Floor) Jalan Raja Ekram, 30450 Ipoh, Perak.

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