- CSI Benefits Home
- Contact Us
- Canada Insurance
- Canada Pension
- US Insurance
- US Pension
- Flexible Benefits
- Group Payroll Plans
3350 East Paris Ave. SE
Grand Rapids, MI 49512
p. 877.274.8796
f. 616.301.2149
New Plan Feature: The “Pop-Up” Optional Form of Pension
The CSI pension plan is being enhanced and will now offer a new form of pension for members who select it at the time they retire. (See the box on the next page for an explanation of forms of pension.)
Called a “pop-up” form of pension, this new option does not replace any of the forms now available, but adds to the current choices. The feature is already available under the U.S. plan.
A pop-up feature is added to a joint and survivor (J&S) form of pension. It comes into effect if a plan member’s spouse dies earlier than the plan member, and it results in raising the member’s pension after the spouse’s death. The pension increase is possible because there no longer will be a need to provide a spousal pension upon the member’s death.
- Example:
- Without Pop-Up Feature
- A member retires and elects a 60% J&S form of pension. This choice reduces the initial pension amount - when compared to a single life form of pension - from $1,000 per month to $900 per month.
Currently, if the plan member dies first, the spouse would receive $540 per month (60% x $900) for the remainder of his/her lifetime. However, the monthly benefit to the member would remain the same, at $900, if the spouse dies first.
- With Pop-Up Feature
- If the member chooses the pop-up feature in conjunction with the 60% J&S pension, there is a cost, which is realized as a reduction in the original pension amount (and in the surviving spouse’s pension amount if the member dies first).
- Compared to the example above, the same pension with a pop-up feature would start out at $890 per month. If the plan member dies first, the spouse would receive $534 per month (60% x $890) for the remainder of his/her lifetime. However, if the spouse dies first, the monthly pension to the member would be reinstated to the original $1,000 that the member would have received under the single life form of pension. Since a single life pension under the plan usually has a 10-year guarantee (see box below), the remaining period of the guarantee would be reinstated as well, based on the time expired since the original date of pension commencement.