The Retirement Fund was established to provide a financially sound social security system with pension benefits and early retirement, whereby workers would obtain a measure of financial security in their old age and during disability, and whereby surviving spouses and children of deceased workers would receive some financial support after the death of the worker.
Retirement benefits are computed on the Basic Benefit. The basic benefit is one-twelfth (1/12) of the sum of the pension element and the social element, where the pension element is two percent (2%) of indexed covered earnings and the social element is fourteen and one-half percent (14.5%) of the first $11,000 of cumulative covered earnings plus seven tenths percent (0.7%) of cumulative covered earnings in excess of $11,000 but not in excess of $44,000.
- Early retirement benefits – to be entitled, the claimant must be: (i) service insured; (ii) have attained the age of 55; and (iii) have filed an application.
“Service insured” means having earned at least 80 quarters of coverage.
- Normal Retirement benefits – to be entitled, a claimant must be: (i) fully insured; (ii) have attained the age of 60; (iii) have filed an application; and (iv) have not applied for and received early retirement benefits.
“Fully insured” means having earned at least one quarter of coverage for each year commencing after the later of (a) the year beginning after June 30, 1968 or (b) the year beginning after the worker attains the age of 21, and up to but excluding the year of the worker’s retirement, disability or death, provided that a minimum of twelve quarters of coverage are required.
- Deferred retirement benefits – to be entitled, the claimant must be: (i) fully insured; (ii) have attained the age of 60 and one month; (iii) have filed an application; and (iv) have not applied for and received early retirement benefits or normal retirement benefits.
Disability insurance benefits
To be entitled, the claimant must be fully insured and currently insured and must be or have been unable to engage in the continued performance of his duties by reason of any medically determinable physical or mental impairment.
“Currently insured” means having earned at least six quarters of coverage during the most recent forty (40) quarters ending with the quarter of the worker’s retirement, disability or death, whichever first occurs. Currently, the minimum disability insurance benefit is $128.99.
Surviving spouse insurance benefits
The surviving spouse of a worker who is fully insured and dies is entitled to a surviving spouse insurance benefit of 100% of the basic benefit, subject to the maximum and minimum survivor benefits, and subject to the earnings test. This is paid until remarriage or until death of the surviving spouse, whichever occurs first.
Surviving child insurance benefits
Each surviving child of a worker who is fully or currently insured and dies is entitled to a surviving child’s insurance benefit of 25% of the basic benefit; provided, however, that the total monthly survivor’s insurance benefits payable to both Surviving Spouse and the Surviving Children shall neither exceed the basic benefit applicable to the deceased wage earner nor be less than $128.99; and where more than one person is entitled to survivor’s benefits, the payments shall be made to all such beneficiaries proportionately to the percentage of basic benefit due them.
A lump sum benefit is given if a worker or self-employed worker has reached the age of 60, or is disabled or died while the worker or deceased worker has not yet reached the eligibility requirements for retirement or disability benefits.
If monthly survivor benefits are not paid or are stopped because all beneficiaries become disqualified as a result of death, remarriage, adoption, attainment of 18 (or age 22 if a bona fide student), or recovery from disability, a lump-sum benefit is due; provided that the benefits paid for under the wage earner’s account are less than 4% of his CCE. The amount of lump-sum benefit equals the total CCE multiplied by 4% less the total monthly benefits already received under the wage earner’s account.