What to do when a NYSLRS account holder dies

The ordinary death benefit is a one-time lump sum paid to a member’s designated beneficiary if the member has at least one year of service credit and dies in active service from a cause other than an on-the-job accident. The amount varies by system and tier; for ERS Tier 3 and 4 members it equals the member’s earnings multiplied by years of service, capped at three years of earnings. Up to $50,000 is paid as group term life insurance, which is exempt from federal income tax.

The accidental death benefit applies when a member’s death results from an on-the-job accident. It is a pension, typically equal to 50 percent of final average earnings (or last year’s earnings) reduced by any Workers’ Compensation benefits, payable to the surviving spouse or, if there is no spouse, to other beneficiaries specified by law. Unlike the ordinary death benefit, it is set by statute and is not directed by the member’s beneficiary designation.

If a retiree was covered by an ordinary death benefit while working, a lump sum is paid to their designated beneficiary at death. It equals 50 percent of the ordinary death benefit during the first year of retirement, 25 percent during the second year, and 10 percent of the benefit that would have been payable at retirement thereafter.

It depends on the pension payment option the member elected at retirement. A Single Life Allowance pays the maximum monthly amount but stops at death with no continuing payment. A Joint Allowance provides a reduced monthly pension that continues to one designated beneficiary for their lifetime. Five-Year or Ten-Year Certain options continue payments to a beneficiary for the remainder of the guarantee period if the member dies within it.

A member may name a person, a trust, or an organization as the beneficiary of the ordinary death benefit. The accidental death benefit, by contrast, is a statutory pension payable to the surviving spouse or other beneficiaries specified by law, so it is not directed to a trust.

NYSLRS requires an original, certified death certificate before any death benefit can be paid. A photocopy can be uploaded through the online death report form so NYSLRS can begin reviewing the account, and NYSLRS then sends the appropriate claim forms to the beneficiary. Survivor claim forms and the certified death certificate are mailed to NYSLRS, Attn: Survivor Services, 110 State Street, Albany, NY 12244.

NYSLRS death benefits are paid to the beneficiary the member designated with NYSLRS, separate from the instructions in a will. Keeping the NYSLRS designation current through Retirement Online determines who receives the ordinary and post-retirement death benefits.