Defined benefit pension survivor payments
Defined benefit (DB) pensions paid to retired employees often have a survivor component. Federal and provincial legislation may require a so-called joint and survivor benefit, typically 60% of the original pension.
Some plans allow different survivor percentages ranging from 0% to 100%. A spouse or common-law partner may need to sign a waiver for the pensioner to elect a lower survivor benefit.
If a plan member dies before retirement or before their pension begins, a surviving spouse is generally entitled to receive a monthly benefit or potentially a lump-sum commuted value that is based on the payout today required to produce the future pension benefit. Again, rules vary from pension to pension.
Some plans allow a pensioner to select a guarantee period of, say, five years, 10 years or longer, so that the pension payments would be payable to the plan member’s estate if they died before a certain number of payments were made.
So, your survivor benefit will depend on the terms of the pension, Donna. If your husband has not yet begun his pension, you should review the pension booklet or his annual statement for details.
If he has already started his pension, you can contact the pension plan to confirm.
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Canada Pension Plan survivor’s pension
The Canada Pension Plan (CPP) pays a benefit to a surviving spouse or common-law partner. It is a pro-rated portion of the retirement benefit earned by the deceased based on the numbers of years of marriage or cohabitation for the couple, Donna.
CPP legislation states that “a common-law partner is a person of either sex who has lived with you in a conjugal relationship for at least 1 year.”
