Regulation 63 Effect of allocationI1
United Kingdom
If an allocation election for the allocation of a member’s pension to another person (“the beneficiary”) has taken effect—
the member’s pension is reduced accordingly (even if the beneficiary predeceases the member); and
if the beneficiary survives the member, on the member’s death the beneficiary becomes entitled to the payment of a pension for life of such amount as the scheme manager may determine, after consultation with the scheme actuary, having regard to—
the amount of the allocation to the beneficiary; and
the beneficiary’s and member’s age and gender.
But the scheme manager may withhold payment from the beneficiary if—
the member dies before the expiry of the period of 2 years beginning with the date on which the election takes effect; and
the scheme manager is satisfied that the member made a false declaration about the member’s state of health in connection with making the election; or
the scheme manager is of the opinion that—
the member made the election under duress, or
the member was mentally impaired at the time when the member made the election and would not have made the election apart from the impairment.
An allocation election is to be disregarded for the purpose of this regulation if it would result in a pension being paid under this regulation to a beneficiary who is neither—
the member’s spouse or civil partner on—
the date on which the member becomes entitled to the pension; or
when the member dies; nor
a dependant of the member for the purposes of paragraph 15(2) or (3) of Schedule 28 to the FA 2004 when the member dies.
If the scheme manager proposes to withhold payment under paragraph (3), the scheme manager must notify the person in writing that the scheme manager proposes to do so and include the reason for the scheme manager’s decision.
Such a notification must give the person information about rights under—
the arrangements established by the scheme manager for the resolution of disputes relating to this scheme that are in force at the time the notification is given; and
Part 10 of the PSA 1993 (Investigations: the Pensions Ombudsman), in respect of any decision made under paragraph (3).