The rationale for flexible benefit design

PetroSA follows a total cost of employment remuneration structure. This allows PetroSA to offer employees a choice in the allocation between cash salary and benefits. 

The central motivation behind flexible benefit design is that you should do your financial planning after considering all the assets, insurance and debts (liabilities) you have. This means you need to consider your "total wealth" as opposed to regarding each of your assets (e.g. your retirement savings) separately. 

Typically your total wealth consists of:

  • Your remuneration package 
  • The value of your house reduced by any loans you have taken on this property 
  • Your Retirement Fund Individual account (i.e. your total accumulated retirement savings) 
  • Other investments (e.g. unit trusts, shares, insurance policies) reduced by any debts you have 
  • Death and disability cover provided by PetroSA insurance policies 

You can select the PetroSA benefits that offer the best value for money in managing your total wealth. 

A key advantage of the benefits provided by PetroSA is that they are secured on a “wholesale” basis as opposed to "retail" basis. This means that the cost structure and policy terms for the various benefits have been obtained using the bulk buying power of PetroSA and are generally better than those you can obtain as an individual investor.

Flexible benefits need careful planning based on your unique circumstances. There is little doubt that if you have choices you will need to spend more time and thought on your benefits than people who have no such choices.