Pension on death of parent

Chitters666

Hi, my partners children's dad passed away a few months ago and the probate for the estate is with their solicitor.
During the time passed we have discovered that a private pension has paid out a huge sum to his previous partner (together 3 years, lived together few months) with no contact to either of his children as next of kin.
Is this allowed? I would of thought they would have contacted his children before deciding who to pay?
Any advice appreciated.

Many thanks

Marcon

Chitters666 said:

Hi, my partners children's dad passed away a few months ago and the probate for the estate is with their solicitor.
During the time passed we have discovered that a private pension has paid out a huge sum to his previous partner (together 3 years, lived together few months) with no contact to either of his children as next of kin.
Is this allowed? I would of thought they would have contacted his children before deciding who to pay?
Any advice appreciated.

Many thanks

How old are the children?

I wonder how you found out? I ask because sometimes what the grapevine reports (in this case I suspect your partner's children?) isn't quite what happened, so being certain of the facts isn't always as simple as it seems. For instance, this might not be a private pension, but could be a death in service payment if the deceased was in employment when they died?

tacpot12

It's allowed. Many pensions schemes will only pay out to children if they are financially dependent on the parent that has died. The trustees of the pensions scheme have to follow the scheme rules, and if there is discretion allowed, they don't have to conduct a search for other potential beneficiaries if the scheme member has nominated some beneficiaries. They will generally follow the wishes of the scheme member unless they are contacted by other potential beneficiaries and presented with compelling new information. 

Under the circumstances, I think the chances of getting the trustees to take any action to recover money is very unlikely. If your family is in financial needs, the best option may be to contact the parter and ask if they would be prepared to help you out, i.e. give you some of what they have received. 

Flugelhorn

sounds like your ex nominated his partner - maybe he felt that the children would have enough from the estate 

400ixl

If his ex was the nominated beneficiary and he didn't change it then that is who the trustees would pay out to.

Marcon

tacpot12 said:

It's allowed. Many pensions schemes will only pay out to children if they are financially dependent on the parent that has died. The trustees of the pensions scheme have to follow the scheme rules, and if there is discretion allowed, they don't have to conduct a search for other potential beneficiaries if the scheme member has nominated some beneficiaries. They will generally follow the wishes of the scheme member unless they are contacted by other potential beneficiaries and presented with compelling new information. 

Trustees still need to carry out reasonable due diligence, even if there is an up to date Expression of Wish form.

Aretnap

400ixl said:

If his ex was the nominated beneficiary and he didn't change it then that is who the trustees would pay out to.

Not necessarily. It is common for the trustees to override an expression of wish, especially where there is evidence that is out of date. It is not binding on then and they do have discretion to pay out to someone else if they see fit.

DullGreyGuy

Chitters666 said:

Hi, my partners children's dad passed away a few months ago and the probate for the estate is with their solicitor.
During the time passed we have discovered that a private pension has paid out a huge sum to his previous partner (together 3 years, lived together few months) with no contact to either of his children as next of kin.
Is this allowed? I would of thought they would have contacted his children before deciding who to pay?
Any advice appreciated.

It depends... was it a DB or DC pension? Was he drawing his pension or not? Was the pension still managed by the scheme or had it gone over to insurers? 

There is a wide range of types of schemes out there, some have trustees with discretion whereas others are fixed and no discretion can be applied. If its the later and either the terms or the expression of wishes are clear on who the beneficiary is then there is little point in them telling others because nothing will change who its paid to. 

Albermarle

Aretnap said:

400ixl said:

If his ex was the nominated beneficiary and he didn't change it then that is who the trustees would pay out to.

Not necessarily. It is common for the trustees to override an expression of wish, especially where there is evidence that is out of date. It is not binding on then and they do have discretion to pay out to someone else if they see fit.

Yes they can override, but I do not think it is common? I have seen it mentioned on the forum that it happens less than 1% of the time, although I do not know how accurate that is.

dunstonh

During the time passed we have discovered that a private pension has paid out a huge sum to his previous partner (together 3 years, lived together few months) with no contact to either of his children as next of kin.
Is this allowed? I would of thought they would have contacted his children before deciding who to pay?

If there was an expression of wish, then much of the job of the trustees is done.  Although typically, the provider would ask for details of other living relatives if the partner was living at a different address to the deceased.  They may also check for financial dependency/linking.  e.g. was there a joint bank account between them.

If they were living together and had joint bank accounts and there was an expression of wish to pay the partner 100% then there is little reason to override that.  

it also depends on the type of pension and the rules specific to that type of pension.

Silvertabby

Albermarle said:

Aretnap said:

400ixl said:

If his ex was the nominated beneficiary and he didn't change it then that is who the trustees would pay out to.

Not necessarily. It is common for the trustees to override an expression of wish, especially where there is evidence that is out of date. It is not binding on then and they do have discretion to pay out to someone else if they see fit.

Yes they can override, but I do not think it is common? I have seen it mentioned on the forum that it happens less than 1% of the time, although I do not know how accurate that is.

Very rare, at least in the LGPS.

Typical was the case in which a fund member had nominated his then girlfriend when he first joined the fund.  15 years later, married to someone other than the aforementioned ex girlfriend, and with children by his wife, he never got round to updating his nomination form.  Easy decision for the trustees to override the form and pay the death in service   (survivor's pension benefits are subject to scheme rules, not nominations) to the wife. 

But not all cases are so black and white.