Special Death Benefit Scheme
Where does the Fund get the money for the Special Death Benefit Scheme?
All Members of the Fund who have contributed during the course of year and whose year end balance in their account is 640VT or more, must contribute towards the Special Death Benefit Scheme. This amount is deducted by the Fund annually from each eligible Member's contribution account and the amount deducted is held in the Special Death Benefit Reserve account.
What is Special Death Benefit Scheme?
This is a scheme set up under the provisions of the VNPF Act to provide additional benefits to the nominees of a member of the Fund in the event the member dies before reaching the age of 55 years. The benefit under this scheme is paid to the person (s) nominated by the member.
When does the Special Death Benefit deduction stop?
The deduction stops if no contribution received during a year or if the contribution received during a year is less than 640VT. Further deductions are also not made from those members who have passed the age of 55 years.
How much do nominees get under the Special Death Benefit Scheme?
Under the current regulations, the nominees get a total sum of 230,000VT. This maximum entitlement is only paid if the deceased member had contributed to the Special Death Benefit Scheme during each of the preceding five years, or if the member was registered within the preceding five years and the contribution must have been made during those years. If, however, the deceased member has not contributed to the Special Death Benefit Scheme during any of the years in the preceding five years, a percentage deduction will be made from the maximum amount for every year of non-payment as prescribed. In addition to the entitlement under the Special Death Benefit scheme, your nominees are also entitled to receive the accumulated balance on your contribution account.
Are the nominees entitled to any benefits under the Special Death Benefit Scheme, if the contributing member dies after reaching 55 years?
The Special Death Benefit Scheme is not applicable to members over the age of 55 years. Hence, the nominees will not be entitled to any benefits under this scheme.