Employees Provident Fund (EPF) is one of Malaysia’s most vital retirement savings schemes. Most EPF members name a spouse, child, or parent as their nominee to receive these savings upon death. But what happens if that nominee dies before you and you forgot to update your nomination?
This article explains the legal implications and the steps your family must take to claim your EPF funds, and how a well-drafted will can make all the difference.
How Does EPF Nomination Work?
A valid nomination allows EPF to release your savings directly to your nominee without the need for legal proceedings. It’s the simplest and quickest way for your loved ones to access your savings when you pass away.
What If Your Only Nominee Has Passed Away?
If your only nominated person (nominee) passes away before you and you haven’t updated your EPF nomination, the nomination is no longer valid. EPF will act as if no nomination exists.
This means your family won’t be able to claim your savings directly. Instead, they will have to go through the Death Withdrawal process, which involves more paperwork, time, and potentially court procedures.
Who Can Claim the Money?
If there is no valid nomination, your immediate family members such as your spouse, children, or parents or a court-appointed administrator may claim the funds. The required documents include your death certificate, proof of relationship, identification, and possibly a court order.
These individuals will need to provide documents like:
- Your death certificate
- Proof of their relationship to you
- Identification documents
- Possibly a court order, depending on the amount involved
How Will the Money Be Paid Out?
The payment from EPF will generally follow this pattern:
- If claim is made within 2 months of death:
- < RM2,500: Full payment
- RM2,500 – RM25,000: RM2,500 first, balance after 2 months
- > RM25,000: RM2,500 first, RM22,500 after 2 months, balance only with Grant of Probate / Letter of Administration.
- If claim is made after 2 months:
- Up to RM25,000 will be released in a lump sum.
- Balance requires Grant of Probate or Letter of Administration
This staggered payout helps families manage urgent expenses, but full access may still take time and legal steps especially if no valid nominee is on file.
Will the Government Keep Your EPF Savings Forever?
Many people worry that unclaimed EPF money ends up in government hands. But this is a common misconception.
If no one claims your EPF savings, your funds are held safely until a rightful beneficiary or legal representative comes forward with the necessary documents. The funds will only be transferred to the Registrar of Unclaimed Monies upon the member reaching age 100 based on their date of birth.
Why a Will with an EPF Backup Clause Helps?
You may write your Will with a backup beneficiary clause that ensures your EPF savings can still be distributed to your intended beneficiaries even if your nomination is no longer valid.
With our will:
- Your executor can claim your EPF savings through the Grant of Probate.
- You don’t have to worry about updating your nomination immediately every time life changes
So even if you and your nominee pass away together, or you didn’t manage to update your nomination in time, your family will still be protected.
But Can My Will Overwrite My EPF Nomination?
No. Your EPF nomination takes precedence over your will. This means that even if your will names someone else to receive your EPF savings, EPF will still distribute the money according to your latest valid nomination.
What If I Nominated a Minor?
Another situation to consider is if your nominee is under 18 years old. While EPF allows minors to be nominated, the money won’t be released directly to them. Instead, it will be paid to their legal guardian or if none is appointed, Amanah Raya Berhad may act as trustee.
To understand how this works, read our article:
My EPF & Insurance Nominee is a Minor – Can They Access the Funds?
If your EPF nominee has passed away and you don’t update your nomination, your family will face delays and legal hurdles to claim your savings. To avoid unnecessary complications, always keep your nomination updated and consider having a will as a backup. Don’t wait until it’s too late, make sure your nomination is up to date and have a will in place to protect your loved ones.
You may make an appointment with our legal advisor here: https://calendly.com/finex-and-co-legacy-advisory/tea-talk-with-legal-expert
