RETIREMENT BENEFITS SCHEMES: A COMPARISON OF THE FOLLOWING OPTIONS
- A Guaranteed Umbrella Pension/Provident fund
- A Guaranteed Stand Alone Pension/Provident Fund
- A Guaranteed Individual Pension Fund
Umbrella Pension / Provident Fund
Stand Alone Pension/ Provident Fund
Individual Pension Fund
Target Market
Small & Medium Organizations
Medium and large organizations
Individuals and small organizations
Key
Benefits
- Reduction in tax liability
by employee & employer
- Interest income not
taxed
- Compound interest
allocation
- Guaranteed interest rate
- Accrued contributions &
interest guaranteed
- A secure income in
retirement
- A lump sum fund before
retirement
- generous tax exemption
on payable benefits
- boosts employee morale
- Other optional insurance
rider benefits e.g. last
expense,group life,
GPA,medical etc
- Reduction in tax liability
by employee & employer
- Interest income not
taxed
- Compound interest
allocation
- Guaranteed interest rate
- Accrued contributions &
interest guaranteed
- A secure income in
retirement
- A lump sum fund before
retirement
- Generous tax exemption
on payable benefits
- boosts employee morale
- Other optional insurance
rider benefits e.g. last
expense,group life,
GPA,medical etc
- Reduction in tax liability
by policy holder
- Interest income not
taxed
- Compound interest
allocation
- Guaranteed interest rate
- Accrued contributions &
interest guaranteed
- A secure income in
retirement
- A lump sum fund before
retirement
- generous tax exemption
on payable benefits
- Other optional insurance
rider benefits e.g. last
expense,group life,
GPA,medical etc
Scheme set up
Employer:
- Signs a Deed of
Adherence to the Umbrella
Trust Deed
- Decides the contribution
rate by employee /
employer,the rule
governing entitlement to
employer benefits,normal
retirement age and
whether pension or
provident fund
Employer:
- Draws & executes a Trust
Deed & Rules (assisted by
Britak)
- Decides the contribution
rate by employee /
employer,the rule
governing entitlement to
employer benefits,normal
retirement age and
whether pension or
provident fund
The Individual Applicant
- joins the scheme simply
by completing an
enrolment and a
beneficiary nomination
form
- Decides the monthly
contribution amount
(minimum:
Kshs.5,000.00) and
normal retirement age
Umbrella Pension / Provident Fund
Stand Alone Pension/ Provident Fund
Individual Pension Fund
Registration status with KRA & RBA
The Umbrella Fund is already registered with KRA & RBA,each participating employer joins by simply executing a Deed of Adherence
The scheme has to be registered independently with both KRA & RBA in order to enjoy the privileges of a registered scheme
The Fund is already registered with both KRA & RBA. You join simply by completing an enrolment form
Trusteeship
British-American Insurance provides the trusteeship service. Trustees must meet once every quarter
Employer and employees nominate the trustees at a 50/50 split,a minimum of 4 trustees are required. Trustees must meet once every quarter.
British-American Insurance provides the trusteeship service. Trustees must meet once every quarter
Vesting Rule
- Employees are entitled to
own contributions 100%
always
- Employees are entitled to
employer contribution 100%
from the second year of
membership. Before one
year,the employer decides
the level of entitlement.
- Employees are entitled to
own contributions 100%
always
- Employees are entitled to
employer contribution
100% from the second year of membership. Before one year,employer decides the level of entitlement.
The policy holder is entitled to all the contributions 100% at all times.
Guarantee on Contributions and interest rate
- Accumulated contributions and interest are guaranteed against reduction throughout.
- Annual interest rate is guaranteed not to fall below 5%.
- Accumulated contributions and interest are guaranteed against reduction throughout.
- Annual interest rate is guaranteed not to fall below 5%.
- Accumulated contributions and interest are guaranteed against reduction throughout.
- Annual interest rate is guaranteed not to fall below 5%.
History of Net Interest Rates
2003 – 10.00%
2004 – 07.50%
2005 – 10.25%
2006 – 18.00%
2003 – 10.00%
2004 – 07.50%
2005 – 10.25%
2006 – 18.00%
2003 – 10.00%
2004 – 07.50%
2005 – 10.25%
2006 – 18.00%
2007 -10.50%
Annual Fund Statement
- Each member gets a personal annual statement.
- The employer gets a consolidated fund statement
- Each member gets a personal annual statement.
- The employer gets a consolidated fund statement
Each Policy Holder gets a personalized annual statement.
Running Costs
(note; Administration fee is free in the first year)
- Administration fee: 3% of
annual contributions,
charged against interest at
the end of the year
- Fund management /
investment fee: 0.125% of
fund balance at year end
- Administration fee: 3% of
annual contributions,
charged against interest
at the end of the year
- Fund management /
investment fee: 0.125% of
fund balance at year end
- Administration fee: 3%
of annual contributions,
charged against interest
at the end of the year
- Fund management /
investment fee: 0.125%
of fund balance at year
end
Umbrella Pension / Provident Fund
Stand Alone Pension/ Provident Fund
Individual Pension Fund
Running Costs Continued…
- R.B.A Levy: 0.2% of the
net annual fund at year end
- Audit Fee: Participating
schemes share the annual
audit cost equally,about
Kshs. 2,000.00 per year.
- R.B.A Levy: 0.2% of the
net annual fund at year
end
- Audit Fee: about
Kshs. 30,000.00 per year.
- R.B.A Levy: 0.2% of
the net annual fund at
year end
- Audit Fee: Participating
policyholders share the annual audit cost equally,about Kshs.2,00.00 per year.
Annual Members meeting
Arranged by British-American for members
Arranged by the Trustees for all members
Arranged by British – American for policy holders.
Other optional Insurance rider benefits
Group Life,GPA,Medical,Last Expense and General Insurance for the organization
Group Life,GPA,Medical,Last Expense and General Insurance for the organization
Life Policies,Unit trust,Home Insurance,Personal Accident Cover and Mortgage Protection
For further details,please contact
winnerkariuki@gmail.com winners never quit and quiters never win