DB benefit calculation question

Hello all, thanks in advance for your help! I'm an IRS EP agent but I haven't worked very many DB cases, and I had a question about my dad's situation.

My dad worked for Albemarle Corp for several years.  They sponsored a DB plan through Merrill Lynch.

In 2017, he was filling out his benefit election form. Among several options he was given, he planned to elect 100% joint and contingent with 60 months certain. Payment was supposed to be $347.53 per month.

He never completed the paperwork (he was very disorganized and lost his birth certificate and was having trouble getting it from Vietnam. He passed away in August 2021 without ever filling out the paperwork.

After his death, I contacted Merrill Lynch and let them know my dad passed away, and I requested that they send a new benefit election package for my mom to fill out.

We got the package, and the only option now is a lifetime pension of $218.34 per month. Does that seem right that the monthly payment would be reduced so much? I still have a lot to learn about DB plans, but I thought the payment would be much higher. I know that options are supposed to be actuarially equivalent, but it just seems way off to me. 

Thanks in advance for your help!

A lot depends on the plan terms, the age of each of your parents and when the payments for each form of benefit were supposed to begin.

Without any actual detail of the plan, this seems about right.  Since your dad never made an election prior to his death then he would fall under the QPSA rules.  Essentially he was a vested terminated participant who was assumed to have made an election the day before his death of a joint and 50% annuity.  Then he dies and his surviving spouse is eligible for that 50% benefit as a single lifetime annuity.

I think Hojo is correct.  In other words, the default provisions of the plan were triggered since there was no election.

Yeah, normal form of benefit is a 50% Joint and Contingent with 60 months certain. Payment would have been $403.64 to my dad back in 2017, so 50% is pretty close to what the current calculation is. 

Thanks for all of your input!