ISR3702

Assignment 02 – Second Semester

Question 1 (50 marks)

Kgabu and Khetha got married in July 2017. They have four children, including
Mokoena, who was born in September 2021. All their children are under the age of 18.
Kgabu, the only breadwinner, passed on in March 2022. Kgabu’s financial information
is as follows:

Assets
• House valued at R450 0000 (where the family is currently staying)
• The three cars valued at R190 000 (driven by the family)
• Cash R150 000

Spouse antenuptial contact

• R500 000 death policy ceded to Khetha

Business assurance
• Buy-and-sell agreement worth R3 million

Provisions of Kgabu’s Testamentary Will.

• Beneficiary: First grandson of Kgabu and Khetha
• Signatories of the will: Khetha, James Lala, Kgabu’s deceased father

Life Policies
• Kgabu’s death policy R120 000 of which the four children are beneficiaries.
• Kgabu’s retirement annuity R98 000 (no indicated beneficiary)
• Provident Preservation Fund valued at R900 000 (James Lala, Kgabu’s friend
is shown as a beneficiary)
• Capital disability policy R40 000
• Kgabu’s death policy R60 000 (no indicated beneficiary)

Page 1 of 2
ISR3702

Questions

1.1 Describe the type of marriage applicable to the case of Kgabu and Khetha. (3)
1.2 Describe the type of estate applicable to the case of Kgabu. (3)
1.3 Indicate whether Kgabu’s testamentary is valid. Motivate your answer. (3)
1.4 Identify policies which will not form part of Kgabu’s estate (Motivate your
answer). (5)
1.5 Identify policies which will not pay the claim (Motivate your answer). (4)
1.6 Describe how the retirement benefits will be distributed. (Motivate your answer).
(10)
1.7 Describe the legislative mechanisms which could help Khetha and children to
benefit from Kgabu’s testamentary will. (8)
1.8 Identify the assets and policies which will form part of the deceased estate. (4)
1.9 Describe the risks mitigated by each life insurance product purchased by
Kgabu. (6)
1.10 Describe the type of tax which is applicable to the case of Kgabu. (4)

Page 2 of 2