7B.11 Unclaimed Monies, Death of a Member and PRS Nomination
Key Takeaways
Unclaimed accrued benefits may be paid to the Registrar of Unclaimed Moneys only if there has been no transaction for more than 12 months after the member's 100th birthday, and only with the PPA's approval.
PRS nomination has been available since 1 August 2017 to members who are Malaysian citizens or foreigners with permanent residence in Malaysia.
A member may nominate up to six individuals, including minors but not organisations, and the allocations must total 100%.
A nomination form must be witnessed by a person of sound mind aged 18 or above who is not a nominee, a nominee's spouse, an employee of the PPA or PRS Provider, or a PRS Consultant.
A nomination is revoked by the death of all nominees, a revocation form, a new nomination, or a nominee's failure to submit the withdrawal form within one year of a Muslim member's death.
Dormant Accounts and Unclaimed Monies
The PRS Provider must keep a member's account open even if it becomes dormant (no money received and no movement between funds for a period).
| Rule | Detail |
|---|---|
| Trigger | No transaction or instruction in any PRS for more than 12 months after the member reaches age 100 |
| Action | The Scheme Trustee may transfer the unclaimed accrued benefits to the Registrar of Unclaimed Moneys under the Unclaimed Moneys Act 1965 |
| Approval | The PRS Provider must first obtain the PPA's approval |
When a Member Dies
- The member's personal representative (executor or administrator) or nominee applies to the PRS Provider for withdrawal.
- Documents such as the probate, letters of administration or Sijil Faraid go to the provider as soon as practicable and are submitted to the PPA.
- After the PPA authorises, the provider pays the proceeds within 7 business days.
PRS Nomination
Since 1 August 2017, members can nominate people to receive their accrued benefits on death.
Who may nominate, and whom
| Rule | Detail |
|---|---|
| Who may nominate | A member who is a Malaysian citizen or a foreigner with permanent residence in Malaysia |
| Who may be a nominee | Individuals only (not welfare bodies, organisations or societies); a minor may be a nominee |
| How many | Up to six nominees |
| Allocation | The member states each nominee's percentage; the total must be 100% |
| Scope | One nomination applies to all the member's PRS accounts, across providers |
| When effective | When a duly completed and witnessed form is received by the PPA or a PRS Provider, whichever is earlier |
The witness
The form must be witnessed by a person of sound mind who is at least 18 and is not:
- a nominee;
- the spouse of a nominee;
- an employee of the PPA or a PRS Provider; or
- a Consultant of a PRS Provider.
Study guide scenario
Adam holds 500 units (RM500) with Provider ABC and 500 units (RM500) with Provider XYZ. He nominates his wife for 60% and his brother for 40%. On his death:
| Wife (60%) | Brother (40%) | |
|---|---|---|
| Provider ABC – Fund 1 | 300 units (RM300) | 200 units (RM200) |
| Provider XYZ – Fund 2 | 300 units (RM300) | 200 units (RM200) |
Each nominee submits a withdrawal-upon-death form, a certified copy of the death certificate and their own identification document.
Revoking a nomination
A nomination is revoked:
- by the death of all nominees during the member's lifetime;
- by submitting a revocation form;
- by making a new nomination; or
- where a nominee fails to submit the withdrawal form within one year of a Muslim member's death.
Under the current PRS Guidelines, a nomination cannot be revoked by a will or any other means. For a Muslim member, a nominee acts as administrator; if a nominee is legally incapable of acting as administrator, that nomination is deemed revoked without affecting other nominees. If a nominee dies before the member and no new nomination is made, that nominee's share goes to the member's estate.
Nomination, Will or Nothing?
| Situation | What happens to the PRS benefits on death |
|---|---|
| Valid nomination in force | Paid to the nominees in the stated percentages after the PPA authorises (for a Muslim member, the nominee acts as administrator) |
| Nomination revoked, or no nomination | Paid to the lawful executor or administrator of the estate, which usually takes longer (probate, letters of administration or Sijil Faraid) |
| A will names different beneficiaries | The will does not revoke a PRS nomination; only the methods listed above revoke it |
| A nominee died before the member and was not replaced | That nominee's share goes to the member's estate |
Because nominations speed up payment and apply across all of a member's PRS accounts, Consultants should remind members to make and update them after life events such as marriage, divorce or the birth of a child.
Applying It
Puan Hasnah, a Malaysian, wants to nominate her husband, her two children aged 12 and 15, and a mosque welfare fund, and asks her PRS Consultant to witness the form. The Consultant should explain that:
- her husband and both children (minors are allowed) can be nominees;
- the welfare fund cannot be a nominee, as nominees must be individuals;
- the Consultant cannot witness the form, as PRS Consultants are excluded; a suitable witness is any sane adult who is not a nominee, a nominee's spouse, a PPA or provider employee, or a PRS Consultant; and
- the percentages must add up to 100%, and the nomination will cover all her PRS accounts.
What is the maximum number of nominees a PRS member may nominate?
Six
Two
Ten
Four
Which person may witness a PRS nomination form?
An unrelated adult colleague of sound mind
The adult spouse of one of the named nominees
The member's own PRS Consultant
An employee of the member's PRS Provider
When may a Scheme Trustee transfer a member's unclaimed PRS benefits to the Registrar of Unclaimed Moneys?
When the member reaches retirement age of 55 and has not withdrawn
After any 12 months of dormancy, at any age, with the Trustee's consent
After 12 months of inactivity past the member's 100th birthday, with PPA approval
After seven consecutive years without any transaction, with FIMM's approval and a court order
Sections you finish are checked off in the contents.