Capital Legacy Shakes Up the South African Financial Services Industry

C apital Legacy, South Africa’s leading provider of Wills, has been operating in the fiduciary and financial industries since 2012. Over the last eight years they have provided more than 300 000 clients with Wills and indemnified over R 70 billion in fees that arise during the estate administration process, which has aided them in gaining invaluable experience and insight into consumer needs and trends.

“We have spent the last eight years building on two primary missions: firstly, helping more South Africans get valid Wills in place and secondly, protecting our clients from the unexpected costs associated with dying,” says Alex Simeonides, co-founder and CEO of Capital Legacy.

Capital Legacy drafts more than 6 500 Wills for new clients every month and is trusted by more than 4 500 financial advisors countrywide, firmly entrenching its position as the single largest provider of Wills in the country and affirming their tagline of “Leave a Legacy”.

Shaking things up

In 2020 Capital Legacy shook up the South African Financial Services Industry by launching not one, but four new innovative offerings, continuing to reaffirm themselves as a serious contender in a traditionally monopolised industry.

“Because we work so closely with advisors and clients during the Will-drafting and estate administration process, we’ve been directly exposed to areas in the market where we feel clients could benefit from improved solutions,” says Simeonides. “Rather than sitting back during lockdown, we’ve been very busy building what we feel are ground-breaking solutions that address some very real gaps in the market.”

On the 13^th of August 2020, approximately 5 000 financial advisors dialled into one of the industry’s most anticipated webinar launches – making this arguably the highest attendance of a financial services product launch in recent years.

Solutions that matter

“Everything we do is about securing our clients’ legacies,” says Simeonides. “It all starts with getting their Will right, understanding the implications and complications of dying, and of course trying to make sure that their dependants can continue to live the life that they planned for them.”

MyCover™ – Life, critical illness and impairment cover that helps you leave a legacy

Most people recognise the importance of life cover, but South Africans by and large are still grossly under-insured. “This reality really hits home when you’re sitting with a family, after the breadwinner has passed away, trying to figure out how to pay for bills, debts, school fees and ultimately considering selling assets such as their home or car just to make ends meet,” says Simeonides.

“What we’ve done with MyCover™ is add on life cover as an extender rather than presenting it as the main product. As far as we know, this has never been done before in South Africa, and has significant advantages for clients as the administration costs are substantially reduced which means we can pass this value to the clients and increase their benefits for less premium,” explains Simeonides.

MyCover™ offers you up to R10 million in life cover and up to R5 million in critical illness and impairment cover, all at greatly reduced premiums and with no invasive medical testing. You’re only required to answer a few medical questions and complete a CO breathalyser test as part of your non-smoker declaration. 

MyCover™ has integrated benefits referred to as BeneFactor™, and the options available to you are:

• More Benefit: Choose to receive more life cover at essentially base cost price.
• Reduced Premium: Opt for reduced premiums without reducing your desired cover amount.
• Cash Back: Boost your cover as well as receive cash back every 5 years.

"Your Will and your legacy for your family go hand in hand. That’s why it just makes sense to us that you should do your life cover with the company that drafts your Will,” states Simeonides. 

HomeVantage™ – A complete home-buyers’ solution that provides all the necessary services, products and value-added benefits through one point of contact

Often, the foundation of people’s financial legacies that they wish to leave to their family is property. One of the insights Capital Legacy has gained from its years of experience, is that financial advisors have, until now, been left out of the process when their clients purchase, what is most likely their greatest asset, property.

 “It’s crazy to think that clients entrust their financial advisors to facilitate and advise on their investments and plan their legacies, yet when it comes to the purchase of one of their biggest assets, the financial advisor is excluded,” highlights Brandon Garbutt, Managing Director of Capital Legacy. “It is therefore just a logical progression that the purchase of property should be closely aligned with the clients’ long-term financial planning, ensuring the right decisions are made and the best option is secured – just like you would with any investment.”

“The approach until now has forced clients to deal with several different people and entities for almost every step – from the bond origination to the conveyance attorneys and the insurance companies,” explains Garbutt.

“We’ve consolidated all the services and products that clients would need when purchasing a property under one roof, and with one point of contact. This means that not only do clients enjoy a more pleasant home-buying experience but they are provided with all the professional services and products from beginning to end and enjoy the most compelling rates and added-value benefits through our unique model,” says Garbutt.

By streamlining the process, Capital Legacy has been able to include some incredible benefits for their home-buying clients:

• Up to 50% off your bond registration and transfer fees.
• A Home Starter Benefit which pays a cash lump sum directly to you that can be used for anything from buying new curtains to settling removal company costs.
• A Bond Accelerator Benefit that pays out approximately 10% of the property value after 15 years to help settle your bond sooner.

Tazkiya™ - Sharī’ah-compliant Will-drafting, estate administration and insurance cover

“South Africa is a diverse country with many different cultures and religions, each with its own, unique characteristics. One religion that has very specific governing principles when it comes to financial aspects is Islam. Leaning on our experience in drafting Wills and estate administration, as well as the expertise of an independent supervisory board that ensures our product and services are and remain Sharī’ah-compliant, we have created an exciting and industry first, end-to-end financial services solution that addresses this gap in the market,” explains Simeonides.

The word ‘Tazkiya’ is derived from an Arabic word that means ‘to purify’ and Capital Legacy has created a Family Takaful structure which will ensure that all the contributions clients make to the fund, to protect their families from the costs associated with their passing away, will remain untainted by interest and uncertainty - keeping it pure.

“We have essentially taken our entire service offering, that we have built up over the last eight years, from Will-drafting, indemnification of fees and estate administration, and recreated it from the ground up to ensure it is ring-fenced, purified and Sharī’ah-compliant for our Islamic clients,” says Simeonides. “Additionally, we’ve added a life insurance component, through the creation of a Family Takaful, that strictly adheres to Sharī’ah Law and which is certified by an independent board of trustees and Islamic scholars.”

“There are nearly one million people of Islamic faith in South Africa and our research shows that as little as 11% have adequate life cover in place,” notes Simeonides. “This is almost entirely due to the lack of feasible solutions available to Islamic clients. It is our goal to change this statistic and we’re confident that Tazkiya™ directly addresses this need.” 

Legacy Succession Planning™ - Full-service succession planning solution

“Over the years, and definitely more frequently lately, we deal with an increasing number of clients who have complex estates which include offshore assets and investments, multiple businesses and beneficiaries, ex-wives and stepchildren for example. These clients require a more robust and holistic approach to their succession planning exercise,” notes Simeonides. 

“From our experience in Will-drafting and estate administration, we are acutely aware of the importance for clients to have their estates structured properly and in the best interest of their loved ones. It was with this in mind that we created our Technical Advice Centre (TAC) and this has evolved to providing high net worth clients with advice and services that takes into consideration their entire estate and how it is structured ensuring that the legacy they leave behind is as they intended,” explains Simeonides. 

Features of Capital Legacy’s Succession Planning Services include:

• All fees related to your estate including trust fees, executor’s fees, conveyance fees, administrative and accounting fees, are indemnified through the Legacy Protection Plan™.
• What usually costs thousands of Rands, is now accessible for a nominal premium of R850 per month (age band dependant) covering the ongoing trustee, legal and basic accounting services as well as the set-up costs.
• You have one primary contact, known as a Succession Planner, who is dedicated to ensuring fluid and comprehensive communication between you, your financial advisor and the various specialist services that are provided in-house at Capital Legacy to execute and manage your succession plan.
• Your estate, business interests and assets, locally and offshore, are structured in the most tax-efficient manner to ensure your legacy is not eroded by taxes and fees that are generally not provided for.
• A full in-house panel of experts ensures that all relevant legislation is applied, and that the correct estate planning vehicles are used.

Capital Legacy’s Succession Planning Services have made succession planning easy and affordable. Many clients who previously considered this service to be outside their estate aspirations can now gain certainty by structuring their estate correctly from the beginning and can have peace of mind that their succession plan will grow as their estate evolves.

All four of these solutions are available through your financial advisor.

For more information, please speak to your financial advisor or contact Capital Legacy at www.capitallegacy.co.za.

*The information in article does not, and is not intended to, constitute financial advice and materials on this site are for general informational purposes only.