Page 22 - Group Insurance and Retirement Benefit IC 83 E- Book

Payment to the estate

The majority of pension schemes do not provide for payment of your death benefit to
your estate except, perhaps, where there are no dependants.

However, the Pensions Act does require the value of any compulsory Preserved Benefits
under that Act to be paid to your estate. Any moneys due under a Pensions Adjustment

Order made at the time of divorce or separation would also be paid to your estate. Any
amount paid to your estate will be disposed of in accordance with your will, or in

accordance with the rules on intestacy if you don‘t make a will. Every pension scheme

member is strongly advised to make a will.

Leaving Death Benefits by will:

You can leave your death benefits to someone else by means of your will only if the
death benefit is paid into your estate. In most pension schemes, this does not happen

immediately, because the death benefits are usually expressed as something payable to
dependants. Generally, payment to your estate will take place only if you have no

dependants (except in the case of certain benefits mentioned in the previous
paragraph).Therefore, in most cases, your will can have absolutely no effect on who

becomes entitled to the benefits payable under the rules of the pension scheme on your

death. You should also note that benefits payable to dependants or other beneficiaries
under the rules of the scheme can be paid fairly quickly after the death of the scheme

member.

Benefits that have to be paid to your estate could not be paid until your will has been
submitted to probate (or until letters of administration have been granted, if there is no

will).

There are a few circumstances in which death benefits will be paid automatically to your
estate: lump sum death benefits under public sector schemes are always payable to the

member‘s Legal Personal Representatives; the actuarial value of preserved benefits under

the Pensions Act must also be paid in this way (unless the Trustees choose to pay
dependants‘ pensions instead); and the value of pension benefits that may be due to you

as a result of a Pensions Adjustment Order will go to your estate as well.