Retiree and Survivor Audits (November 2013)

OSFI recognizes that conducting retiree and survivor audits is a good governance practice to keep records up to date and to confirm that pension benefit payments being paid from the pension fund continue to be paid to the appropriate party. 

In accordance with the Pension Benefits Standards Act, 1985, the payment of a pension continues until the death of the retiree or their survivor.  To clarify OSFI’s message communicated in InfoPensions 6, before stopping a payment of pension benefits to a retiree or survivor, plan administrators are expected to obtain sufficient evidence or a reasonable basis to conclude that the retiree or survivor is deceased. 

It has come to OSFI’s attention that some pension plans may be stopping pension benefit payments without performing due diligence to conclude that the retiree or survivor is deceased. A retiree’s or survivor’s failure to complete a form requested by the plan administrator, or respond to a series of letters, should not be considered sufficient evidence or reasonable basis to conclude that the retiree or survivor is deceased.

Plan administrators must administer the plan as a trustee for the employer, plan members, former members and any other persons entitled to pension benefits under the plan. It is the plan administrator’s responsibility to establish a sufficient or reasonable basis on which to conclude that a retiree or survivor is deceased.  For this reason, we encourage pension plans to review their administrative processes and procedures for retiree and survivor audits.  When attempts to contact the retiree or survivor by phone, mail or e-mail have failed, the following measures may aid in establishing sufficient evidence or reasonable basis to conclude that the retiree or survivor is deceased:

• Send a registered letter to the retiree or survivor
• Contact the member’s family or in-case-of emergency contact to obtain written confirmation that the member is deceased
• Contact the appropriate union to request that they search their records for the retiree’s last known address and contact information
• Search online white pages
• Review obituary announcements in local newspapers and/or funeral homes
• Contact the financial institution where the pension cheques are deposited or cashed
• Contact the Vital Statistics Records office in each province and territory
• Contact the National Search Unit with Service Canada. *This service is no longer available.
• Hire a search firm or agency to search public records to assist in finding the retiree(s) and/or survivor(s) or evidence of their death
• If the retiree or survivor is receiving their pension benefit by way of direct deposit, if possible, mail a cheque to the retiree or survivor instead

When contacting retirees and survivors, plan administrators should be sure that their communications and expectations are clear.  A plan administrator’s notice of the decision to stop a payment of a pension should be sent by registered mail to the retiree’s or survivor’s last known address.