What is the difference between a death beneficiary and an option beneficiary?
A death beneficiary is chosen by the member to receive a one-time lump-sum death payment upon the member s death. The amount of the lump-sum payment varies, depending on whether you have Coverage A or B, and if the death occurs before or after retirement. For further information, read topic 502 . An option beneficiary is chosen by the member to receive a lifetime monthly allowance upon the member s death. The member s retirement allowance is actuarially reduced to reflect the age of the member and the beneficiary when the option is selected; this reduction is to insure a lifetime monthly allowance to the beneficiary. The same individual may be designated the beneficiary of both the lump-sum payment and the monthly allowance. For more information, read topic 502 .
Related Questions
- If a member is eligible for pension and dies in service without an insured death benefit or widows pension, is his beneficiary entitled to a refund of his contributions?
- Dont I have the option to change the beneficiary to another family member at any time?
- What is the difference between a death beneficiary and an option beneficiary?
