Bereavement: what to do
When someone close to you dies there are emotional and practical challenges to face, and getting the financial situation in order can be daunting.
One of the first things you should do when someone dies is let their pension scheme know. The earlier you can do this, the easier it will be get the affairs of the deceased in order and, if you're a dependant, the quicker you may receive any pension benefits due to you.
- My partner or someone in my family has died
- Telling the pension scheme of a death
- Lump sum on death
- Dependants' benefits
- What happens when I die?
Deceased members of defined benefit (DB) schemes
If the person who has died was paying into a DB scheme, the scheme is likely to pay out a lump sum benefit. This will often be a multiple of the deceased’s salary at the time of their death.
The scheme may also repay the contributions paid into the scheme by the member, again as a lump sum payment.
It’s also likely the scheme will pay a pension to the deceased’s partner (usually 50% of what they would have received), and possibly even to dependent children.
All the above will depend on the scheme’s rules, which vary from scheme to scheme. There may, for example, be conditions attached, such as the partner needing to be married to the scheme member, or be financially co-dependent. Similarly, any children may need to be under a certain age or still in full time education for a pension to be payable to them.
The scheme rules should be set out in a member booklet, so check you have this and that it's an up to date version.
Deceased deferred members of defined benefit schemes
A deferred member of a pension scheme is someone who is no longer paying into it. When that member dies, it's less likely that a lump sum will be paid, based on a multiple of their salary. You may also receive a refund of any contributions paid.
What do I need to do to inform the pension scheme of the death of a member?
If the deceased was still paying in to a pension scheme, the scheme will probably require an original death certificate, along with the member’s name and contact details. So it’s a good idea to keep all pension documents together in a safe place, that is known to loved ones. Some schemes will not accept copies of a death certificate, so it may help to get several official copies of the death certificates so you don’t have to request additional ones later.
Can a pension being paid to a person who has died be transferred under the terms of his will from an estranged spouse to another person?
The rules or regulations or policy conditions that apply to the pension scheme or plan will set out the benefits payable on death of a member. It's not possible to assign pension benefits under the terms of a will to another person.
If I die, will my partner get a pension from my pension scheme?
The exact position depends on the pension scheme's rules or policy conditions or regulations. Typically, pension schemes only promise to automatically pay pensions to a legally married spouse or civil partner after a member died. However, the pension scheme may provide a dependant's pension, although it's generally necessary to prove financial dependency or interdependency for this to happen.
Where can I find out more?
If you need more information, please contact us. A pension specialist from our team will be happy to help with whatever pensions-related question you have. Our help is always free.