495—14.12 (97B) Preretirement death benefits.
	 14.12(1) Pre-January 1, 1999, deaths. Where the member dies prior to the first month of entitlement, the death benefit shall include the accumulated contributions of the member plus the product of an amount equal to the highest year of covered wages of the deceased member and the number of years of membership service divided by the “applicable denominator,” as provided in Iowa Code section 97B.52(1). The amount payable shall not be less than the amount that would have been payable on the death of the member on June 30, 1984. The calculation of the highest year of covered wages shall use the highest calendar year of covered wages reported to IPERS.
	 14.12(2) Post-January 1, 1999, deaths—death benefits under Iowa Code section 97B.52(1).
	  a.   	 Definitions.
“Accrued benefit” means the monthly amount that would have been payable to the deceased member under IPERS Option 2 at the member’s earliest normal retirement age, based on the member’s covered wages and service credits at the date of death. If a deceased member’s wage record consists of a combination of regular and special service credits, the deceased member’s earliest normal retirement age shall be determined under the regular or special service benefit formula for which the majority of the deceased member’s service credits were reported.
“Beneficiary(ies)” shall, unless the context indicates otherwise, refer to both window period beneficiaries and post-window period beneficiaries.
“Implementation date” means January 1, 2001.
“Nearest age” means a member’s or beneficiary’s age expressed in whole years, after rounding for partial years of age. Ages shall be rounded down to the nearest whole year if less than six complete months have passed following the month of the member’s or beneficiary’s last birthday, and shall be rounded up if six complete months or more have passed following the month of the member’s or beneficiary’s last birthday.
“Post-window period beneficiary” means a beneficiary of a member who dies before the member’s first month of entitlement and on or after January 1, 2001.
“Window period beneficiary” means a beneficiary of a member who dies before the member’s first month of entitlement during the period January 1, 1999, through December 31, 2000.
	  b.   	 Any window period beneficiary or post-window period beneficiary may elect to receive the lump sum amount available under Iowa Code section 97B.52(1). Sole beneficiaries may elect, in lieu of the foregoing lump sum amount, to receive a single life annuity that is the actuarial equivalent of such lump sum amount.
A window period beneficiary must repay any prior preretirement death benefit received as follows:
	 (1) 	 If a window period beneficiary wishes to receive the larger lump sum amount, if any, the system shall pay the difference between the prior death benefit lump sum amount and the new death benefit lump sum amount.
	 (2) 	 If a sole window period beneficiary wishes to receive a single life annuity under Iowa Code section 97B.52(1), the sole window period beneficiary may either:
	  1. 	 Annuitize the difference between the previously paid lump sum amount and the new larger lump sum amount, if any; or
	  2. 	 Annuitize the full amount of the largest of the lump sum amounts available under the revised statute, but must repay the full amount of the previously paid lump sum amount.
	 (3) 	 To the extent possible, repayment costs shall be recovered from retroactive monthly payments, if any, and the balance shall be offset against current and future monthly payments until the system is repaid in full.
	  c.   	 A claim for a single life annuity under this subrule must be filed as follows:
	 (1) 	 A sole window period beneficiary must file a claim for a single life annuity within 12 months of the implementation date.
	 (2) 	 A sole post-window period beneficiary must file a claim for a single life annuity within 12 months of the member’s death.
	 (3) 	 A beneficiary who is a surviving spouse must file a claim for a single life annuity within the period specified in subparagraph (1) or (2), as applicable, or by the date that the member would have attained the age of 70½, whichever period is longer.
	  d.   	 Elections to receive the lump sum amount or single life annuity available under Iowa Code section 97B.52(1) and this subrule shall be irrevocable once the first payment is made. Election shall be irrevocable as of the date the first paycheck is issued, or would have been issued but for the fact that the payment is being offset against a prior preretirement death benefit payment.
	  e.   	 No further benefits will be payable following the death of any beneficiary who qualifies and elects to receive the single life annuity provided under this subrule.
	  f.   	 The provisions of this subrule shall not apply to members who die before January 1, 1999.
	  g.   	 Procedures and assumptions to be used in calculating the lump sum present value of a member’s accrued benefit are as follows:
	 (1) 	 IPERS shall calculate a member’s retirement benefit at earliest normal retirement age under IPERS Option 2, based on the member’s covered wages and service credits at the date of death, and the retirement benefit formula in effect in the month following the date of death.
	 (2) 	 For purposes of determining the “member date of death annuity factor” under the conversion tables supplied by IPERS’ actuary, IPERS shall assume that “age” means the member’s nearest age at the member’s date of death.
	 (3) 	 For purposes of determining the “member unreduced retirement annuity factor” under the conversion tables supplied by IPERS’ actuary, IPERS shall assume that “age” means the member’s nearest age at the member’s earliest normal retirement date. If a member had already attained the member’s earliest normal retirement date, IPERS shall assume that “age” means the member’s nearest age at the date of death.
	  h.   	 Procedures and assumptions for converting the lump sum present value of a deceased member’s preretirement death benefit to a single life annuity are as follows:
	 (1) 	 For purposes of determining the “age of beneficiary annuity factor” under the conversion tables supplied by IPERS’ actuary, IPERS shall assume that “age” means the beneficiary’s nearest age as of the beneficiary’s first month of entitlement.
	 (2) 	 A beneficiary’s first month of entitlement is the month after the date of the member’s death.
	 (3) 	 Effective for claims filed after June 30, 2004, no retroactive payments of the single life annuity shall be made under this subrule.
	 (4) 	 Effective for claims filed after June 30, 2004, the beneficiary whose single life annuity is less than $600 per year shall be able to receive only the lump sum payment under this rule.
	  i.   	 Eligibility for favorable experience dividend (FED) payments. Any sole beneficiary who is eligible for and elects to receive a single life annuity under this subrule shall also qualify for the dividend payments authorized under rule 495—15.2(97B), subject to the requirements of that rule.
	  j.   	 Retired reemployed members and aged 70 members who retire without terminating employment. Preretirement death benefits for retired reemployed members and aged 70 members who retire without terminating employment shall be calculated as follows:
	 (1) 	 For beneficiaries of such members who elect IPERS Option 4 or 6 at retirement, IPERS shall recompute (for retired reemployed members) or recalculate/recompute (for aged 70 members who retired without terminating employment) the member’s monthly benefits as though the member had elected to terminate employment as of the date of death, to have the member’s benefits adjusted for postretirement wages, and then lived into the recomputation or recalculation/recomputation (as applicable) first month of entitlement.
	 (2) 	 The recomputation provided under subparagraph (1) shall apply only to beneficiaries of members who elected IPERS Option 4 or 6, where the member’s monthly benefit would have been increased by the period of reemployment, and is subject to the limitations of Iowa Code sections 97B.48A, 97B.49A, 97B.49B, 97B.49C, 97B.49D, and 97B.49G. The recalculation/recomputations provided under subparagraph (1) shall apply only to beneficiaries of members who elected IPERS Option 4 or 6, where the member’s monthly benefit would have been increased by the period of employment after the initial retirement, and is subject to the limitations of Iowa Code sections 97B.49A, 97B.49B, 97B.49C, 97B.49D, and 97B.49G. In all other cases, preretirement death benefits under this subparagraph shall be equal to the lump sum amount equal to the accumulated employee and accumulated employer contributions.
	 (3) 	 Beneficiaries of members who had elected IPERS Option 4 or 6 may also elect to receive the accumulated employer and accumulated employee contributions described in subparagraph 14.12(2)“j”(2), in lieu of the increased monthly annuity amount. Notwithstanding subparagraph (2) above, if the member elected IPERS Option 5 at retirement, the lump sum amount payable under this paragraph shall be the greater of the applicable commuted lump sum or the accumulated employee and accumulated employer contributions.
	  k.   	 Inactive members with less than 16 quarters of service credit. For deaths occurring after June 30, 2004, preretirement death benefits shall be provided solely under Iowa Code section 97B.52(1)“a,” and shall only be payable in lump sum amounts for inactive members who have less than 16 quarters of service credit. For purposes of this paragraph, an inactive member is a member as defined under Iowa Code section 97B.1A(12).