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Planning for loved ones
- Members
- How your plan works
- Planning for loved ones
Survivor benefits
Survivor benefits are an important feature of the plan to help provide for your loved ones when you pass away, whether before or after retirement. It’s important to keep your spousal and beneficiary information up to date to ensure any applicable survivor benefits are paid according to your wishes.
Keep in mind, if you’ve earned a pension under a participating employer’s prior plan, different rules may apply for pre-conversion survivor benefits.
Choosing your survivor benefit
When you pass away after retirement, your spouse, children, or designated beneficiaries may qualify for survivor benefits. The amount and type of benefit will depend on the payment options you choose at retirement.
Your options with a spouse
The normal form of pension for a member with a spouse on the date of retirement is a 50% spousal pension.
If your spouse opts not to waive the 60% spousal pension – or you elect the 80% or 100% options under the Plan – your pension will be actuarially reduced and accordingly, your monthly pension payment will be lower. This is because the value of your pension will probably be paid over a longer period covering both you and your spouse’s lifetime.
The table below outlines the forms of spousal pension available to you.
| Spousal payment option | Your spouse will receive |
| 50% spousal pension (normal form) | 50% of your pension for their lifetime. This option requires a spousal waiver and is the normal form of pension for members with a spouse (resulting in the maximum regular pension payment to you). |
| 60%, 80% or 100% spousal pension | 60%, 80% or 100% of your pension for your spouse’s lifetime (results in an actuarially reduced pension for your lifetime). |
| 50%, 60%, 80% or 100% spousal pension with a 10-year guarantee | No matter which spousal pension you choose, if you pass away before 120 monthly payments have been made to you, your surviving spouse is entitled to your full pension payments for the remainder of the 120-month guarantee period, and then reduces to the 50%, 60%, 80% or 100% spousal pension for the remainder of their lifetime. If your spouse also passes away before the 120 payments have been made, the remaining guaranteed payments will be paid to your spouse’s beneficiary or estate. If your spouse passes away before you, the remaining guaranteed payments will be paid to your beneficiary or estate. |
However, law requires that a 60% spousal pension be provided. If your spouse doesn’t need their full entitlement, they can sign a legal waiver for you to elect a 50% spousal pension instead, which prevents your regular pension from being reduced to provide their additional spousal pension. The waiver must be submitted before your pension begins.
If your spouse is more than 10 years younger than you, your normal form of pension will be actuarially reduced to reflect the likelihood that your spouse will receive more pension payments over a longer period.
Waiving survivor benefits
Your spouse has the right to waive their entitlement to pre-retirement survivor benefits. Waiving this entitlement means your spouse will not receive a survivor benefit if you pass away before them, and it will instead to go your designated beneficiary. A spouse will override any other beneficiary designation made by you unless you and your spouse have completed the required waiver form.
Your options without a spouse
| Payment options without a spouse | |
| Lifetime pension with 10-year guarantee | If you pass away before receiving a total of 120 payments, the balance of payments will be made to your beneficiary or estate. This is the normal form of pension for a member without a spouse. |
| Lifetime pension with 15-year guarantee | If you pass away before receiving a total of 180 monthly payments, the balance of payments will be made to your beneficiary or estate. This option requires an actuarial reduction to reflect the longer guarantee period. |
Keep in mind that if you don’t designate beneficiaries, your benefits will go to your estate. You can change your beneficiary designations for pre-retirement death benefits at any time before your retirement begins.
Survivor benefits for dependent children
If you have dependent children at retirement, you may be able to provide them with an income from UPP when you pass away. Your options are affected by the age of the children and the nature of their dependence.
Frequently asked questions
What happens to my pension when I pass away?
Survivor benefits are an important feature of the Plan, to help provide for your loved ones when you pass away, whether before or after retirement. Completing the Beneficiary Designation Form when you join the Plan helps ensure the right benefits are provided to the right people. The form is available from your university pension administration team.
If you have a spouse, as defined by the Plan, that person is automatically entitled to your death benefits unless they sign a waiver.
If you do not have a spouse or your spouse waived their rights to survivor benefits, you can designate a beneficiary to be next in line for death benefits. If you do not have a spouse or a beneficiary, this money will be paid to your estate.
Please see UPP’s Member Handbook or contact Member Services for more information.
What is the value of the lump sum your beneficiary gets?
If you pass away before retirement, your beneficiary will receive the commuted value of your pension. The commuted value is the lump sum value of your pension that would be payable at retirement calculated in accordance with Ontario pension standards legislation.
If you pass away after retirement, UPP’s normal form of pension for a member without a spouse is a lifetime pension for you with a 10-year guarantee. This means if you retire and pass away before receiving a total of 120 monthly payments, the balance of payments will be paid to your beneficiary.
If you have more than one beneficiary, the benefit will be split in percentage shares you designate. If you do not have a beneficiary, the benefit will be paid to your estate.
- © 2024 University Pension Plan