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Retirement Annuities
Monday, May 1, 1989
Hats off...

Charter Life has just re-launched an updated version of its Plus 6 RA. The package was initially designed and directed at the individual and small business groups of five or more, but advances now provide a new option to enable the product to be utilised as a “Top Hat” scheme for “Top Drawer” executives.
‘‘This means that the plan is also suitable for companies that already have an existing pension fund’’, says senior manager legal services, Martin Sweet. “Their executives and top management can have a top hat package to boost their existing package with basic retirement annuity benefits and optional benefits to cover perceived gaps.”
Greater flexibility has been achieved by the comprehensive mix of benefits provided under the new plan. All these benefits are in addition to the already much simplified procedures for issuing the contract.
Standard pension schemes are generally expensive and relatively difficult for a small business to set up and administer. Charter Life’s Plus 6RA, however, has a very streamlined administrative procedure. For a group scheme, each employee has just one coupon to complete. This coupon actually becomes the policy contract. There are minimal health questions too.
Indeed a contract ‘‘can be written up there and then,” says Richard Plank, the company’s marketing manager. ‘‘Ease of administration is a vital aspect,” he says.” Premiums, inclusive of the employee’s contribution, are deducted by the company from salaries or wages and paid to Charter Life as one single monthly payment.” This earns savings of up to 6% on the premiums payable.
In addition, the employer’s contribution toward the employee’s policy is deductible in the form of salary for tax purposes. The employees can in turn deduct full contributions to the scheme from earnings in the month in which they are paid. The policy is also portable and employer contributions remain part of the employee’s policy.
Flexibility is ensured in the Plus 6 RA by allowing a selection of basic retirement benefits and life cover, plus the six optional benefits that go to make up the series.
These optional extras are: Survival Benefit, to cover the so-called dread diseases; inflation protection; disability benefit; hospital benefit of up to R100 per day when hospitalised; and Survival and Disability benefit premium waivers. Under the disability benefit, if the policyholder has also taken advantage of the Survival Benefit option, then premiums for the disability benefit are reduced to 50% of the normal rate.
“This can amount to a significant saving depending on the level of life cover, and is not offered by all life assurers.”
The unique mix and comprehensive cover available under the Plus 6 RA makes this one of the most significant and innovative plans offered by the industry today. “We are still offering the plan to individuals who are able to take full advantage of the complete range of optional benefits making up the new product.”

Copyright © Insurance Times and Investments® Vol:2.5 1st May, 1989
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