Pensions: Relatives of 36,087 dead workers get N106bn

A total of N106.92bn has been paid to relatives of 36,087 deceased workers as pension and insurance benefits under the Contributory Pension Scheme.

Latest figures obtained from the National Pension Commission on Friday by our correspondent showed that the amount was paid as of the end of September last year.

The report also indicated that the commission had continued to approve payments of death benefits to beneficiaries of the deceased employees.

“This figure moved the cumulative death benefits payments to a total of N106.92bn (including life insurance) to 36,087 deceased employees from both the private and public sector (federal and state governments) as at the end of third quarter,” PenCom stated.

The commission noted that the amount paid included the group life insurance cover provided by the Pension Reform Act and the pension contributions in the Retirement Savings Accounts.

It was also learnt that the amended Pension Reform Act 2014 was making more relatives of deceased workers to demand for the benefits of their late breadwinners because of the ease of getting the entitlements.

The removal of a Will or a letter of administration as a requirement to access the funds was said to be prompting a lot of relatives to seek the payment of the insurance benefits.

The PRA states that an employer shall maintain life insurance policy in favour of an employee for a minimum of three times the annual total emolument of the employee.

Under the PRA 2004, the Pension Fund Administrators were not allowed to pay out such benefits if the deceased worker did not leave a Will behind unless the relatives could produce letters of administration, which is considered a tedious document to get. This made most relatives to forgo these benefits as they were unable to go through the stress of obtaining letters of administration.

Before the advent of the PRA 2014, claims used to be paid into the RSAs of the workers, with the PFAs enforcing the requirement for letters of administration.

The only ground on which an insurance company will now ask for the letters of administration is if the deceased worker did not leave any beneficiary behind.

Operators have said the provision of insurance cover and removal of the letter of administration will enable claims to be paid to beneficiaries of deceased workers.
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