STRP Focus on Equity: More Equitable Death Benefits
The STRP currently offers an additional death benefit option for members who pass away prior to retirement with at least eight years of service. This additional benefit option, paid to dependent children or dependent parents, is rarely used and complicated to administer. In the history of the STRP, only 10 members’ beneficiaries have received an additional benefit under this Plan provision. It also creates scenarios where certain children receive death benefits while their siblings don’t, simply because they are still considered a dependant under the Plan rules.
To improve equity and ensure all members’ spouses and beneficiaries receive an equitable death benefit, this alternative death benefit provision is being removed. Don’t worry – your spouse (or beneficiaries) will still be entitled to the normal death benefit provided under pension legislation. That means that if you pass away prior to retirement, your spouse would be eligible to receive a lump-sum payout of the value of your pension, or to convert that lump sum into a lifetime monthly pension. If you do not have a legal spouse when you pass away, your beneficiaries or estate would be paid the lump-sum death benefit. No changes have been made to the Plan’s death benefits for members after they retire.