Death benefit under the Plan
The death benefit under the Plan is payable to your spouse, your designated beneficiary, or your estate. The amount of this benefit depends on whether your death occurs before or after retirement.
Death before retirement
The value of your accrued pension under the Plan is paid to your spouse or, if you do not have a spouse, to your designated beneficiary or your estate. Please note that the spouse eligible for the death benefit is the person who was considered your spouse on the day before your death.
If you have a spouse
Your spouse will have the choice to:
- transfer the death benefit to his or her RRSP in accordance with the current tax legislation; or
- receive a cash payment, after paying the applicable tax.
However, if you postponed the payment of your pension because you are over the age of 65 and still actively at work, your spouse will receive a monthly pension equal to the total value of your vested rights.
Spouse’s death benefit waiver
Your spouse takes precedence over any beneficiary designation unless he or she has waived his or her right to the death benefit in writing.
To waive the death benefit, your spouse must fill out the Spousal waiver of death benefit form, which is available in the Forms section of the Personal Zone.
If you do not have a spouse (or if your spouse waived the death benefit)
Your designated beneficiary or, if there is none, your estate will receive the death benefit in a cash payment, minus the applicable tax.
Please note that in the event of death before retirement, the pension accrued value is payable in full, as there is no reduction applicable in proportion to the degree of solvency.
Death during retirement
When you retire, you select a death benefit that will become payable in the event of your death. Although there is a default death benefit under the Plan, which is guaranteed 10 years, there are other options with different guarantee periods and percentages applicable to the pension that will be paid to your spouse in the event of your death. The amount of your pension will increase or decrease according to the option you select.
Normal form of pension
The normal form of pension is a pension guaranteed for 10 years (i.e., 120 monthly pension payments). Please note that your pension is payable for life regardless of the guaranteed period, because it only applies in case of death before the end of the 120 payments.
Please also note that payment of the pension varies depending on whether or not you have a spouse when you retire.
60% joint and survivor pension mandated by law
By law, you must select a pension option under which your surviving spouse receives at least 60% of the pension that was payable to you before you died. This, however, reduces the amount of your own pension payments.
Your spouse may waive this right to 60% of your pension by filling out the Spousal waiver of death benefit form attached to the Retirement benefit statement that you receive when you retire. Should your spouse waive his or her right to a pension, your own pension payments will be the same as they would be if you did not have a spouse.
If you have a spouse when you retire
The death benefit amount paid to your spouse depends on whether your death occurs within the guarantee period, if any, or later (i.e., before or after all the guaranteed monthly payments have been made, if any).
The following table assumes that your spouse has not waived his or her right to 60% of your pension.
Death within
the guarantee period | Death after
the guarantee period (or if there is no guarantee period) |
- Your spouse will initially receive 100% of the pension you were receiving before you died, until all the guaranteed payments have been made.
- Thereafter, your spouse will receive a lifetime pension equal to 60% of the pension amount you were receiving before you died.
Should your spouse die before the end of the guarantee period, the balance will be paid in a single lump-sum to your designated beneficiary or estate if there is no designated beneficiary. | Your spouse will receive a lifetime pension equal to 60% of the pension amount you were receiving before you died. The payments will stop when your spouse dies. |
If you do not have a spouse when you retire (or if your spouse has waived the 60% joint and survivor pension)
The death benefit amount depends on whether your death occurs within the guarantee period, if any, or later (i.e., before or after all the guaranteed monthly payments have been made).
Death within
the guarantee period | Death after
the guarantee period (or if there is no guarantee period) |
Your designated beneficiary, or estate if there is no designated beneficiary, will receive the value of the balance of the pension you were receiving before you died, until all the guaranteed payments have been made, including the payments already made at the time of death. The value of the balance is paid in a single lump-sum, actuarially equivalent to the residual payments. | No death benefit is payable. |
Examples of death benefit after retirement
Joan retires at age 61, chooses a 60% joint and survivor pension guaranteed 10 years, and receives a monthly pension of $1,000. She dies 7 years later, at age 68. There are therefore 3 years left in the guarantee period.
She has a spouse
Joan’s spouse will receive:
- 100% of Joan's pension (i.e., $1,000 per month) for the remaining 3 years of the guarantee period (36 guaranteed monthly payments).
Should her spouse die before all the payments have been made, Joan’s designated beneficiary, or estate if no beneficiary is designated, will receive, in a single lump-sum payment, the value of the remaining monthly payments.
- Thereafter, he will receive 60% of this amount (i.e., $1,000 x 60% = $600 per month) until he dies.
She does not have a spouse (or her spouse waived his joint and survivor pension)
Joan's designated beneficiary, or estate if she does not have a designated beneficiary, will receive a lump-sum payment actuarially equivalent to the remaining 36 guaranteed monthly payments.
Thereafter, no death benefit will be payable from the Plan.
Other forms of pension payments
Upon retirement, you may select a form of pension payment other than the one set out by the Plan. The amount of your pension will then be adjusted by actuarial equivalence. You may select:
- a different guarantee period of either 5 or 15 years
- one or more payments, if your life expectancy is less than two years as a result of a serious illness (medical certificate required).
Your beneficiary
Have you thought about your beneficiary?
A few minutes to think can make all the difference!
Designating one or several beneficiaries only takes a few minutes (filling out the form, that is!). Take the time to think things through and decide to whom your pension should be paid in the event of your death. The related form is available on this website, under the Forms section.
This could help avoid problems later and ensure the timely payment of your death benefit.
If you have a spouse, this person is the beneficiary of your death benefit, unless he or she waived this right.
If you do not have a spouse, the benefit is paid to your designated beneficiary or, if there is none, to your estate.
Do not forget to notify the appointed Plan administrator of any change in beneficiaries by using the correct form under the Forms section.
Please note that if you hold more than one membership in the Plan, your most recent beneficiary designation applies to each of your memberships, past or future, and voids all past designations, unless there is an irrevocable one.
Please refer to Section 12 of this document to get additional information about spouse and beneficiary designation.
Question and answer about death benefit
What if my spouse, when I die, is not the person to whom I was married when I retired?
If your first spouse had waived the death benefit (or if you did not have a spouse when you retired), no survivor’s pension (aside from any remaining guaranteed payments) will be paid.
If, however, your first spouse had not waived the death benefit, he or she generally loses his right to a pension when he or she stopped being considered your spouse. Your second spouse will not be entitled to a pension in any case.
In the case where your spousal union is dissolved during retirement, you may ask that your pension amount be adjusted accordingly.
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