Pension Summary Plan Description

7.4 Automatic Changes in the Form of Benefit Payment

In the following situations, your Joint Annuity will terminate and the dollar amount of each monthly benefit payment will retroactively revert to the dollar amount that would have been paid if your benefit had been originally paid as a Straight Life Annuity:

  • If your Joint Annuitant is your Spouse and your Spouse dies before you and within 12 months after your Retirement Date;
  • If your Joint Annuitant is your Spouse and you die within one year of the date you were married, or
  • If your Joint Annuitant is someone other than your Spouse and you die within one year of the date you designated that person as your Joint Annuitant.

See Appendix F.8.1, Automatic Changes in the Form of Benefit Payment for Benefits Earned Before July 1, 1990, for a description of the dollar amounts and forms of payment applicable to benefits earned before July 1, 1990.
The following table shows the benefit amount for different forms of payment. Alice's Normal Retirement Benefit is $1,000. We'll assume that Alice and her Spouse are age 65.

If Alice elects a . . . she will receive monthly payments of . . . and after her death monthly payments of . . .
Straight Life Annuity $1,000 $0
Modified Straight Life Annuity $950.00 for one year followed by $589.46 if Sandra dies before receiving 12 monthly payments.
$1,000.00 after the first year $0 if Alice dies after receiving 12 or more monthly payments
Five Year Certain Life Annuity $972.60 $972.60, assuming Alice receives less than 60 monthly payments, her Spouse would receive the remaining number of payments so the total
payments to Alice and her Spouse equal 60.
50% Joint Annuity $914.24 $457.12
66-2/3% Joint Annuity $885.07 $589.46
75% Joint Annuity $875.34 $656.51
100% Joint Annuity $855.89 $855.89

The actuarial reduction factor for the Five Year Life Annuity depends on age at retirement. At age 65 the factor is 97.26%. The actuarial reduction factors based on the Five Year Certain Life Annuity for the 50% Joint Annuity, the 66 2/3% Joint Annuity, the 75% Joint Annuity and the 100% Joint Annuity are 94%, 91%, 90% and 88%, respectively. For each year that the Joint Annuitant is younger (or older) than you, the percentage factor is reduced (or increased, but to not more than 99%) by 1/2%.