Easing the pain of your grieving loved ones

MALAYSIA - Sarah lost her husband, Adam (not their real names), in an accident at a fairly young age. They had three school-going children and a newly launched bakery business.

While she had the emotional support of her parents and siblings in initial difficult days of juggling her role as a single parent and the sole provider of her children, she was exhausted with the burden of meeting the expenses of her family and business.

It is not that she and Adam were not financially prepared -- they had invested in a number of instruments that would ensure a comfortable life for the family in case anything happened to either one of them. They had properties and a number of liquid assets.

However, these assets were subject to probate and administration laws upon the death of either one of them, and the process of estate distribution is time consuming.

Luckily, Adam had thought ahead. When Amanah Saham Nasional Bhd (ASNB) launched the Hibah Amanah for Muslims, and the Trust Declaration (Pengisytiharan Amanah) for non-Muslims, Adam was one of the first to apply. These two facilities allow for unit trust funds managed by ASNB to be distributed to recipients of the Hibah Amanah or Trust Declaration (Pengisytiharan Amanah) upon the death of a unitholder, like Adam.

After 21 days of notification of his death, Adam's investments in Amanah Saham Bumiputera and Amanah Saham Nasional were distributed to Sarah (as his named benefactor) and the children (with Sarah as the guardian), relieving her of her financial burden and allowing her to move on.

The story of Adam and Sarah is a common scenario among Muslims and non-Muslims when a loved one dies. However, unlike Adam, who was well prepared, not many will see their problems solved as efficiently. Many had to go through a lengthy and costly process to claim the assets of the deceased. Some would be caught in a messy tussle between next-of-kin of the deceased, resulting in most estate claim cases dragging on for years.

According to figures released by the Syariah Judiciary Department of Malaysia last month, Muslims in Malaysia had unclaimed assets worth RM66 billion (S$26 billion), with RM60 billion in immovable assets and the remaining RM6 billion in liquid assets. This means each of the 18 million Muslims in Malaysia could receive RM3,667 in cash and assets. While the figure may not be meaningful on its own, RM66 billion could be used to expand the Muslim economy. There are no figures for non-Muslims unclaimed assets, but it is believed to be substantial.

In the case of a non-Muslim, a person's will is only effective upon death and the assets will be distributed according to the law. A Muslim, on the other hand, can only bequeath a third of his assets via a will to his non-Faraid heirs and the remaining assets will be distributed according to Faraid (Muslim inheritance law).

By law, a beneficiary must engage a solicitor to apply for a grant of probate from the High Court for assets with a will, and for letters of administration from the High Court for movable and/or immovable assets above RM2 million, a process that could take months.

For assets less than RM2 million, comprising entirely or partly immovable properties, letters of administration from the land office are required. Alternatively, for moveable assets less than RM600,000, an order from Amanah Raya Bhd may be applied for. Similar to the application to the courts, applications to the land office or Amanah Raya Bhd are also lengthy.

To help resolve the issue of unclaimed inheritance, ASNB now provides the Hibah Amanah and Trust Declaration (Pengisytiharan Amanah) facilities to its 11 million unitholders to facilitate the distribution of a unitholder's investments efficiently. The facilities are effective from the time the Hibah Amanah or Trust Declaration (Pengisytiharan Amanah) is formalised. However, the unitholder can continue to own and receive benefits from investments throughout his or her lifetime, and the distribution of the investments will take effect upon a claim being made by the hibah or trust recipients after the death of the unitholder.

The distribution of the deceased unitholder's investment under ASNB's Hibah Amanah or Trust Declaration (Pengisytiharan Amanah) facilities can be concluded after 21 days of notification to ASNB.

Under both facilities, the unitholders of all the unit trust funds managed by ASNB can name up to 10 recipients. Unit holders can visit any ASNB branch to apply for the facility.