Lumpsum FAQ


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Why doesnt NAPSA pay lumpsums?

The Authority pays out lump sums to members who are eligible to make a claim but do not meet the qualifying criteria for payment of any of the Pensions benefits i.e. Invalidity Pension, Early Retirement Pension and Normal Retirement Pension.

The Authority also pays out lump sums to an administrator or qualifying beneficiaries of a deceased member who died before making any claim.

How does one qualify for a lumpsum?

The Authority pays out a Retirement Lump Sum when:

  • A member attains retirement age but has less than one hundred and eighty (180) contributions.

The Authority pays out to the qualifying beneficiaries or an administrator a Survivors Lump Sum when:

  • A member dies before lodging any self-claim.

The Authority pays out an Invalidity Lump Sum when a member having qualified for an Invalidity claim:

  • Has less than sixty (60) contributions, or
  • Has sixty (60) or more contributions but less than twelve (12) contributions in the three (3) years right before the invalidity.

How is it calculated?

The lump sum is equal to the value of the member’s and employer’s indexed contributions plus interest.

Lump sums are calculated as follows:

L = Sc + l1 +l2 + …….+ln

“L” is the lump sum payable,

“Sc” is the sum of the indexed contributions,

“I1,I2, ….. ln” is the total interest on contributions made.

In the case of a Survivors claim, the lump sum will then be divided into shares in accordance with the provisions of the National Pension Scheme Act No. 40 of 1996 (“NPS Act”) and the National Pension Scheme (Benefits and Eligibility) Regulations, S.I No. 71 of 2000 (“Regulations”).