death benefit for unmarried participants

[AndyH]

Large plan with REA (J&100%) death benefit for married participants but no death benefit for unmarrieds wants to address perceived inequity and is looking for suggestions. Plan is sponsored by a University. Plan has no lump sum provision (over $5,000) except that the REA death benefit is available as a lump sum if under $10,000.

Two options might be paying survivor portion of a 10 C&C and also paying 50% of the PVAB to a beneficiary.

Any other ideas? What might be typical of a large plan unmarried death benefit that wouldn't drive HR bonkers with paperwork? (Non-union)

Thanks for any suggestions.

[Theresa Lynn]

I assume that this is to be payable if the unmarried participant dies before beginning to receive distributions, right? If so, I think that any of the following would certainly be fair--

identical to the QPSA for marrieds,

lump sum value of above,

or life/10 yr certain of equivalent actuarial value...

If you mean adding an option where the unmarried may receive anything other than a life annuity, then, why not options identical to those payable to marrieds, 50/75/100 joint and survivor, 10 year life/certain, or whatever.

I am pleased to see companies thinking about all of the unmarrieds who totally lose out if they die before retirement, often leaving dependent children, parents, etc., in a lurch (and essentially making all of their hard work and accruals disappear).

[AndyH]

Right. Pre-retirement death is the issue. Thanks for the comments.

A downside to doing this is the issue of beneficiaries, collecting designations, changes, missing designations, etc. With REA only, none of this is necessary, which is why hearing the experiences of others would be helpful.