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  • Rukevwe Erakpotobor

Death Benefit Payment in Nigeria: Does Pension Stop After Death?

While no one wishes to face death before reaping the rewards of their efforts, death is inevitable, and there are cases where an RSA holder passes before or after retirement. In these situations, some crucial questions that many people would ask are: does pension stop after death? Do the relatives of the deceased continue to receive payment, or does the money in their pension pot remain with the PFA forever?

Worrying about what will happen to all that money saved up during those active years of working hard is valid. In this article, we will address this concern and explore what you can do to control pension funds in the event of death.

What is the Death Benefit Payment?

In pensions, the death benefit payment is the money belonging to a deceased RSA holder, paid to a third party or named beneficiary. Think of it as inheriting assets from a deceased family member upon their demise, much like passing on a monetary gift. The Pension Reform Act of 2014 has made provisions for an easy lump payment of pension balances from a pension pot to a named beneficiary in case a person passes.

Who is the Beneficiary?

A beneficiary is a person who is entitled to receive a contributor's or retiree’s pension savings in the event of death before or after retirement. The beneficiary may be anyone you officially mention in a will, your spouse and children, or one whom the Probate Registry appoints in a letter of administration. 

How the Death Benefit Payment Works

When a person dies before or after retirement, the money in their pension pot is secure with their Pension Fund Administrator (PFA). Typically, one of the policies of the Pension Reform Act is that pensioners receive payments for up to 10 years after they retire. However, if the pensioner dies before the ten years elapse, the beneficiary receives the monetary balance for the remaining years.

Therefore, after death, the PFA should transfer the funds to the beneficiary once they finish processing the death benefit payment. This process would often involve tendering documents that include but are not limited to a death certificate, a will, or a letter of administration. Oakpensions has a publicly available, comprehensive document detailing the requirements for seamless processing of the death benefits payment.

man in dark suit holding a piggy bank
Death Benefit Payment in Nigeria. Credit: Oak Pensions

Does Pension Stop after Death; What you Must do

What happens to your pension savings after death depends largely on what you do now as an RSA holder. You are obligated to name a known beneficiary or beneficiaries who can access your pension pot. Doing this facilitates ease of assessment and helps your loved ones boycott rigorous legal processes. 

Usually, we advise having a will prepared and made handy for emergency and unforeseen cases. This is because a will guarantees without dispute who you are naming as your beneficiary(ies) and how you would want to distribute the funds. Be that as it may, in cases where the deceased has no legal will, savings will fall back on their next of kin.

It is equally important to note that when one does not nominate a beneficiary or next of kin, their funds may sometimes end up in places they would not have wanted. At this point, the Probate Registry is obligated to award the funds to any available representative through a letter of administration. 

On a Final Note

When an RSA holder dies, their named beneficiary(ies) should easily receive the rest of their pension on their behalf. Their chosen PFA is also obligated to transfer the funds once the beneficiary begins and completes processing the death benefit payment requirement. 

Need a more secure and seamless retirement savings plan? Transfer your pension savings account to Oakpensions. Contact us at 09087448661 or send an email to to take the next vital step. 

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1 commento

21 feb

Why is the pension of someone who retired since January 2022 and cleared in August 2022 not yet paid



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