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Upon your death, your survivor should notify both the Office of Retirement Services and Voya Financial® so any survivor benefits available from the Pension and Savings Components of your plan can be determined and paid to your beneficiaries.
It is important that you name a survivor pension beneficiary or request that the default provisions of the law apply, and name a refund beneficiary. Name your beneficiaries for your pension in miAccount at www.michigan.gov/orsmiaccount. You can view or change your beneficiary information at any time with just a few simple clicks.
Survivor pension beneficiary
Your eligible survivor pension beneficiary receives a monthly pension upon your death. Eligible monthly survivor pension beneficiaries include your spouse, minor child, or one of the following who is dependent on you for at least 50 percent of his/her personal support: your adult child, your brother or sister, or your parent. If your survivor was enrolled in insurance benefits at the time of your death, he/she may continue to be enrolled at the unsubsidized rate.
If you have no surviving spouse or unmarried children under age 18, no continuing monthly benefit will be payable unless ORS has your valid beneficiary designation on file and only as long as the survivor pension beneficiary you names remains dependent on you/the income provided by the pension.
While you are actively employed, if you do not designate a beneficiary with ORS, the default provision of the law automatically provides a lifetime monthly benefit to your spouse (if eligible). If you are not married, the benefit is provided to your unmarried minor children in equal payments until they reach age 18, marry, or are adopted.
If no ongoing monthly pension benefits are payable upon your death, your accumulated pension contributions on account will be paid in a lump sum to the person named as your refund beneficiary with ORS.
Note: ORS must receive your beneficiary designation before you terminate employment. The default provision does not apply to deferred members. See If you die as a deferred member.
If you die while an active member
If you die from a work-related injury or illness incurred during your public school employment, it is considered a duty death. A monthly survivor pension may be payable to your named eligible survivor pension beneficiary, regardless of your age or years of service, if a workers' compensation benefit is awarded based on your work-related injury or illness.
Subsidized health, prescription drug, dental, and vision insurance coverage is also available to your eligible beneficiary receiving a survivor pension and eligible dependents at the maximum subsidy allowed by law, currently set at 80 percent. If you have the Personal Healthcare Fund for your retiree healthcare benefit, any employer matching contributions and related earnings in your 401(k) plan account will be forfeited in lieu of the subsidized insurances.
If your death is not a result of an injury or illness incurred at work, it is called a nonduty death. A monthly pension may be payable to your survivor pension beneficiary if you are vested in the pension component of your plan with at least 10 years of service.
The nonduty death survivor benefit is payable to your eligible survivor pension beneficiary beginning the month following your death. The benefit is calculated as if you retired the day before you died and elected the 100 percent survivor option.
With the Personal Healthcare Fund for your retiree healthcare benefit, your survivor pension beneficiary and dependents are not eligible for subsidized health, prescription drug, dental, or vision insurances through the retirement system. However, your survivor would have access to the Personal Healthcare Fund investments and earnings.
If you die before retirement and no monthly survivor pension is payable, your pension contributions and interest in your account will be paid to your refund beneficiary in a lump sum. If you haven't named a beneficiary, your contributions may be distributed by probate court order. Go to Retiree Healthcare for more information.
If you die as a deferred member
If you die while your retirement is in deferred status (that is, you left public school employment after vesting but before you’re old enough to draw your pension), a monthly survivor pension will be payable to your eligible survivor pension beneficiary provided (1) you have at least 10 years of service, and (2) you designated your beneficiary with ORS before you terminated employment.
If you designate a beneficiary with ORS before you terminate employment, you can change your beneficiary while in deferred status. If the nomination you filed with ORS specified the default provision, you must resubmit your nomination to name an eligible person as your beneficiary because the default provision will not apply while you are deferred.
Then monthly survivor pension becomes payable beginning the month you would have otherwise become eligible to receive your pension; it is paid as if you have chosen the 100 percent survivor option.
If you die before retirement and no monthly survivor pension is payable, your pension contributions and interest in your account will be paid to your refund beneficiary in a lump sum. If you haven’t named a beneficiary, your contributions may be distributed by probate court order.
If you die after leaving public school employment and before you have sufficient service to be vested for a pension, no survivor pension payable. Upon notification by your survivor, we will return any of your pension contributions and accumulated interest to your refund beneficiary or your estate.
Before you leave your job, designate who will receive a refund of your pension contributions. If no beneficiary is on file, your contributions and accumulated interest may be distributed by court order.
If you die after you retire
A monthly pension is payable only to the person you designated as your survivor pension beneficiary if you selected a survivor option. This person is named when you apply for retirement.
It’s important to name beneficiaries for your retirement investment account so that in the event of your death, your savings will be distributed the way you want. Here’s how it works:
Paper beneficiary forms are required if you are married and you wish to name someone other than your spouse as your primary beneficiary in the 401(k) Plan, since your spouse must provide consent.
Payout options upon your death are determined by several factors including who is named as beneficiary (spouse vs. non-spouse) and whether Required Minimum Distribution (RMD) payments have already begun from the account. Call Voya if you need specific details.
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