Expert: Allen - 5/31/2011

Question
My mother died from a (GBM) brain tumor on April 14th 2011. She got sick last Sept and was on Med leave until she retired on Feb 1st 2011.

My father requested her pension to start on Feb 1st and the company did not make it a matter of record until March 11th. The company then took until May 4th to get the paper work to my father and because she died in between these two dates the company is saying my dad is only entitled to the 50% single life annuity not the lump sum option or 4 other guaranteed annuities.

We are not happy with this because if she were alive when the paper work was received there would have been a lump sum option and the value is over a 100k. We can contest the offer but i'd like to know if we have legal ground to stand on. The dispute is that over 30 days passed and if we received the paper work in that time we would have the lump sum option because my mom was alive.  Also, is it possible we are "locked" in as of March 11th when the company started the paper work. It seems cruel we can loose the lump option because she dies too soon.

Answer
I suggest the following:

1. Write the plan administrator and tell them that your mother wanted to elect a lump sum payment. However, due to long delays at their end, she died before she could formally choose this option on the plan's election forms.

2. If you do not get a satisfactory response, contact the local office of the U.S. Dept. of Labor - Employee Benefits Security Administration. They may be able to help.

3. If 1 and 2 don't work, contact the Pension Rights Center in Washington. There is a good chance they can help you.

4. If none of the above work,you will have to hire an attorney. Unfortunately, this will probably be costly. If you go this route make certain you contact an attorney who is knowledgeable about pension plans and ERISA.

Good luck.