National Pension Commission (PenCom) Releases an Addendum to the Circular on Revised Procedures on the Processing of Death Benefits.

National Pension Commission has released the Addendum to the Circular on Revised Procedures on the Processing of Death Benefits.

The Commission started that it’s attention has been drawn to certain challenges encountered by Pension Fund Administrators (PFAs) in the cause of implementing the procedures stipulated in the circular on Revised Procedures on the Processing of Death Benefits issued on 03 October 2018, which necessitated the issuance of this Addendum to clarity and simplify some procedures for the processing of death benefit claims.

The addendum is in 3 parts: Part A highlights the paragraphs retained from the earlier circular, rephrased paragraphs for clarity are shown in Part B, while Part C contains new procedures to address identified challenges.

Part A: Retained Paragraphs of the Circular on Revised Procedures on the Processing of Death Benefits.

1. The Pension Fund Administrators (PFAs) are required to enhance the internal controls and carry out further investigation on the documentation submitted by the Next of Kin (NOK)/beneficiary of the deceased before submission to the Commission for approval.

2. PFAs shall ensure due diligence and conduct search at the Probate Registry of the issuing Authority to confirm the genuineness of the documents as well as the verification of the information of the named administrator and sureties.

3. PFAs shall confirm the Death Certificate of the deceased issued by a hospital and Police Report (where death is by accident).

Part B: Rephrased Paragraphs of the Circular on Revised Procedures on the Processing of Death Benefits.

4. PFAs shall request the beneficiary(s) who presented death certificate issued by the foreign hospital, to depose to an affidavit that the Retirement Savings Account (RSA) holder died in a hospital outside Nigeria.

5. PFAs shall trace and locate the new address, where the hospital relocated for verification of the death certificate issued by them . In the event of closure of hospital, PFAs shall contact the relevant authorities (Ministry of Health/Hospital Management Board) or bodies responsible for issuance of operating license.

6. PFAs shall contact the employer to verify the demise of an employee who died in active service.

7. In the case of deceased retirees on programmed withdrawal, PFAs shall verify their demise from their spouse, children or relatives as well as Village Clan/Head for retirees residing in the village and include details in the report mentioned in Clause 13 below.

8. In addition to Clause 7 above, PFAs shall request the beneficiary(s) of deceased retirees to provide an attestation from a Notary Public stating the demise of the retiree.

9. PFAs shall request the beneficiary(s) of deceased employee/retiree of Treasury Funded MDAs that enrolled, but yet to access his/her RSA, to present the Verification Slip and Retirement Letter of the deceased, while for employees in Private Sector and Self-Funded Agencies, the beneficiary(s) shall present the deceased Retirement Letter.

10. In the event that the RSA holder died in active service and the name of his/her current employer differs with the employment records in the PFA’s database, PFA shall confirm and update its database with the current employer’s name and upload the correct information on the Commission’s database.

11. In case of death at home of a retiree or employee thus, death certificate not issued by the hospital, PFAs shall request the beneficiary(s) to register the death at the National Population Commission and obtain the death certificate.

12. PFAs shall obtain the passport photograph with the detailed information of the beneficiary(s) for record purposes and retain same in the deceased Mandate File.

13. The representative of the PFA that conducted the search shall write a
comprehensive report of their findings at the issuing Probate Registry which shall be retained in the deceased Mandate File.

Part C: New Paragraphs to the Circular on Revised Procedures on the Processing of Death Benefits.

14. PFAs shall collect the detailed information of the nominated Parent/Guardian of the minor beneficiary (S) including a valid means of identification which includes NIN Card/Slip, International Passport and Driver’s License and obtain the passport photograph for retention in the deceased Mandate File.

15. PFAs shall request beneficiary(s) to submit a NIN (slip or card) or any valid means of identification, the use of voter’s card would not be accepted.

16. Payment of death benefits shall be made to the named administrator on the Will admitted to Probate, Administrator/Beneficiary (s) in Letter of Administration (LOA), Estate Account or as may be directed by the Court of Competent Jurisdiction.

17. In the event of payment to a wrong beneficiary(s), PFA shall be liable and pay from its Statutory Reserve Fund.

18. In the event that PFA received two LOAs or Court Order from two named beneficiary(s), the PFA shall act as a mediator to facilitate reconciliation between the two parties in order to reach an agreement on which LOA or Court Order to be adopted for processing of the death benefits.

19. In furtherance to 18 above, where the two named Administrators agreed on which LOA or Court Order to be adopted, the PFA shall request the parties to consent to same and process the death benefits request in line with the Terms of Agreement which shall become binding on the parties.

20. Where the two named Administrators could not reach an agreement on which LOA or Court Order to be adopted, the PFA shall apply the principle of equity, the principle of first in time. Thus, PFA shall use the first LOA or Court Order submitted to process the death benefits.

PFAs shall comply with the requirements of these addendum as well as take cognizance of the provisions of Clauses 4.0 and 5.0 of the Regulation on Administration of Retirement and Terminal Benefits in processing death benefits request.

This addendum takes immediate effect.