Pensions - Death in Service lump sum

I have been unable to take out life insurance on my ex to protect my maintenance payments if he dies.
My ex's current pension pays a 3x salary lump sum payment if he dies before he retires- ie a life insurance policy.
This life insurance is not dealt with in the Consent Order.
I've since been told the court could have ordered the pension scheme to pay all or part of the lump sum to me - is this true?
I asked my solicitor about it after the Consent Order and she said it was up to my ex-husband whether he named me as beneficiary or not.

it usually goes to whoever has been put down as the immediate next of kin,sometimes children are nominated as beneficiary. etc.similar situation as yours re this. will need to sort this one out before court order done, to make sure my x doesnt remain on mine as beneficiary.I would ring the pension scheme direct, my pension scheme had a seperate dept dealing with pension/divorce issues and set my mind at rest over a serious matter.

Hi Topaz - I'll try but I don't think his pension scheme will tell me anything about his pension including beneficiaries because I'm not a member [and he won't communicate with me at all.]
As I understand it the court could have ordered that I would get an insurance payout to replace maintenance if he dies before retirement.
I think who benefits from pension death benefits should be part of financial disclosure in form E.

I believe that technically the lump sum payment from your ex’s pension could have been made the subject of an attachment order. However, the cost of drafting and implementation would probably have been disproportionate.

I am puzzled that you have been unable to take out life insurance on your ex to protect your maintenance payments. This could be that your ex is what is called uninsurable, which basically means that an insurer would not issue a policy because the risk of him dying is statistically too great. Usually, this only applies if the person is in very poor health, so it does not occur too often. The same issues can arise from the person’s occupation or pastime. For example it might be difficult or even impossible to get insurance on someone in the armed forces if they were about to be posted off to one of the major trouble spots.

If you want to pursue the idea of taking out life cover on your ex, post again and I can offer some information (NOT advice), on what you might do.

On the subject of getting your name logged as the beneficiary, there are two parts to this (sorry!). Schemes often provide two types of benefits, the lump sum death-in-service (DiS) payments and so-called dependents pensions. The scheme rules usually define a dependent (including financially dependent children). In theory, it is possible for a Court to instruct a scheme how to deal with the dependents pensions but there could be problems if there is a conflict between what the scheme rules say and what a Court might order.

DiS is normally dealt with by what is called an “expression of wishes”. This is a simple form that the scheme member completes. The problem is that the member can change the expression of wishes whenever s/he wants. So, you could have yourself made the beneficiary of the DiS benefits one day and the member could change nominate someone else later.

The simplest answer as far as the DiS problem is concerned, is to take out insurance (whether ordered by the court or otherwise).

Sorry that this is yet another answer that is far too long.

Hi Peter
Long detailed answers are good.
The amount involved was just under £300,000-worth a go?
He failed to disclose it on Form E - I got the information by questionnaire.
At FDR the whispering barrister seemed to be saying to my solicitor [drooling in the corner] that you couldn't assign the death benefits from a pension that was shared on divorce.
I was advised after Consent Order that if my ex refused to co-operate, and he did, I couldn't insure him.
He said he was uninsureable.Could the court have ordered him to have a medical?
In any case I have no idea whether I am named as beneficiary but I very much doubt it. When we were together he didn't complete the Expression of Wish form - he said it would come to me automatically - now he's single and cohabiting who would this insurance payout go to?
I'm going to ring the pension company to ask if I'm a beneficiary .

just to clarify - my barrister said [ I think ] that because I had shared the pension I could not by law also be assigned the death benefit from the shared pension.
Is this true?

Hi Maggie

There are some minor terminology issues here. You cannot assign a pension but it can be shared or attached. You can make an attachment order on the DiS benefits.

David Davidson refers to this in his book “Pensions and Marriage Breakdown” (published by the Law Society). He states that a sharing order cannot be made on a pension that is already subject to an attachment order. This of course often makes it difficult to achieve the required outcomes, as the pension itself will have a much greater value that the DiS benefits in terms of what it would cost to replace them.

One of the possible hurdles is that DiS benefits are often insured benefits. They may be part of the whole remuneration package but at a detail level, they may be a separate arrangement, albeit falling under the Trust, which constitutes the scheme. By this, I mean that the DiS benefits may actually be provided by an insurer to the employer. The insurance contract is between the employer/scheme and the insurer. That’s why you have the “expression of wishes” situation. As the employee/member, you tell the employer/scheme what your wishes are regarding the DiS.

I suspect that DiS benefits are often missed off the Form E. Not because there is necessarily any intent to mislead, it’s just that the whole issue is so complicated (and boring for most) that they don’t appreciate that the benefit exists.

The DiS cover is not a perfect way of protecting maintenance payments because they only exist whilst the individual is “in service”. If s/he leaves that employer and moves to another, the DiS benefits will cease. The insurance route is probably a better method of protecting maintenance payments. Most insurance firms would be very reluctant to provide cover where the insured person is uncooperative, but the Lloyds insurance market may be more open to the concept.

I very much doubt whether you will get anywhere with asking the pension company whether you are the DiS beneficiary. For a starter, they probably don’t know – the information is probably held on the employer’s HR file and would only be accessed if the need arose. I am certain that the requirements of the Data Protection Act will prevent anyone releasing such “sensitive” information to you, even though you are a potentially interested party.

Finally, you asked where the insurance payout would go if your ex has not made his wishes clear. The answer will almost certainly be that the pension scheme trustees would decide – I for one wouldn’t want to be a trustee in that meeting!

I hope that this helps, though I suspect it has merely served to make you even more cross about the whole situation.

Peter