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Cash Commutation Priority

This field is used to determine the order in which pension will be commuted for cash. Select from the drop-down list which of the options to use. The options are:

  • After Split (actives only)
  • Before Split (actives only)
  • Priority
  • Pro Rata

If After Split or Before Split is used then the pension is commuted by reference to the Latest Finish Date specified on the Offset Slice.

Typically an active member will have a service timeline as shown in the following diagram:

If After Split is selected then the pension accrued after the End of the Offset Slice would be commuted first. Within each period pension may increase at different rates and are commuted in the following order:

  • Special
  • Main
  • Pension Increase 3
  • Pension Increase 4

If Before Split is selected then the pension accrued before End of the Offset Slice would be commuted first. Within each period pension may increase at different rates and are commuted in the following order:

  • Special
  • Main
  • Pension Increase 3
  • Pension Increase 4

If Priority is selected then the cash is commuted according to the pension increase rate applied on the Slices or PUP Tab. Pensions are commuted in the following order:

  • Special
  • Main
  • Pension Increase 3
  • Pension Increase 4

If Pro Rata is selected, then pension is commuted in proportion to the pension amounts, irrespective of the pension increase rate.