Is there a pension payout after death

socratez

My mum passed away a couple of months ago. She had a small private pension that paid out a small amount each month. I wrote to the company informing them of this and asked if there was a pay out to come. They replied saying they have closed the account and there is not a payout? Does this sound right, if the person dies is there no money remaining in the "pot" to pay out? What if she had paid in more than it paid out over the years?

Nearlyold

Yes it sounds right if your mum chose an annuity without a guaranteed period when she took the decision to start drawing an income from her pension savings or the guaranteed period has already ended.  She may have chosen that option as it would give a higher income at the start.

Keep_pedalling

If this was a defined benefit pension or she had taken out an annuity then there will be nothing to pay out. 

gm0

The only type of pension where a pot would remain to be dealt with is called "drawdown". It was first introduced in a limited way in 1995 ("capped drawdown"). And the more flexible version from 2015. Oversimplified but the rough timeline. So compare when your mother retired against that timeline and any info you have.

Residue of Drawdown pensions (Defined Contribution) are inheritable.
This is paid out by the pension company based on the expression of wishes logged by the individual. This is filed with the pension company. It is not part of the will.

Pre 1995 all private pensions were either paid as an income (Defined Benefit) to first death then a spouse benefit to some level until 2nd death. Or an accumulated DC pot was used to purchase an annuity from a life insurance company - again a defined income + uplifts - which again often drops at first and ends at 2nd death. No payout.

The young deaths pay for the older ones. And everybody gets more income from pooling up the risk about how long we each live.