GSIS Pre-retirement Seminar

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GSIS Pre-retirement Seminar

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GSIS SOCIAL INSURANCE BENEFITS

Congratulations for a fruitful career in government
service!
Your hard work in the government does not go unnoticed.
In fact, it is finally paying off. It is now the GSISs turn to
ensure you of a worry-free future for the dedicated
service you rendered over the years.
As a retiring government employee, you have four
retirement laws with different options to choose from.
Briefly, if you were in the service on or before May 31,
1977, you may avail of retirement benefits under RA 660,
RA 1616, PD 1146, or RA 8291.
If you entered government service after May 31, 1977,
you may avail of retirement benefits under PD 1146 or RA
8291.
Republic Act 1616 (Gratuity benefit)
Eligibility
1. You must have entered government service on or
before May 31, 1977.
2. You must have rendered at least 20 years of service
regardless of age and employment status.

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3. Your last 3 years of service prior to retirement must be

continuous, except in cases of death, disability, abolition,
or phase-out of position due to reorganization.
Benefits
1. Gratuity payable by your last employer based on your
total length of service (converted into gratuity months)
multiplied by the highest compensation you received.
The gratuity shall be computed as follows:
1st 20 years of service
x 1
21-30 years of service x 1.5
31-above years of service x 2
2. Refund of retirement premiums consisting of your
personal share plus interest, and government share
without interest, payable by the GSIS.
Sample computation of RA 1616
Basic Data
Name:
Office:
Date of Birth:
Date of entry in service:
Date of Retirement:
RCS:
AMC:
RAMC:
Highest Salary Received:
Age at Retirement:

Juan Dela Cruz

DepEd Pulang Lupa
06/20/1947
03/01/1973
01/01/2009
31.8657400
23,805.55
24,505.55
P25,000.00
61.52 y/o

Computation
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1. Gratuity Benefit:
1 x 20
= 20.00
1.5 x 10
= 15.00
2 x 1.86574
= 3.7315
Total:
38.7315
38.7315 x P25,000.00 = P 968,287.50
2. Refund of Premiums (payable by GSIS)
Republic Act 660 (Magic 87)
Eligibility
1. You must have entered government service on or before
May 31, 1977.
2. Your appointment status must be permanent.
3. Your last 3 years of service prior to retirement must be
continuous, except in cases of death, disability, abolition,
and phase-out of position due to reorganization.
4. You must meet the age and service requirements under
the Magic 87 formula, as shown below:
Starting age is 52 years old Age + Service = 87
AGE 52 53 54 55 56 57 58 59 60 61 62 63 64 65
YOS 35 34 33 32 31 30 28 26 24 22 20 18 16 15
Your maximum monthly pension:
Above 57 years old
80% of the average monthly
compensation (AMC)
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Below 57 years old

75% of the AMC
where AMC = average salary with premium payments
received during the last 3 years immediately preceding
the date of retirement
Your monthly annuity:
Retirement age
below 60
60 to 63
63 and above

Annuity benefit
Monthly annuity or 1 year
lump sum upon request with
discount
3 year lump sum plus 2 year
pension at age 63
5 year lump sum

Benefits
1. Automatic pension
If you are below 60 years old, you are qualified to a
monthly annuity, with the option to request for a one-year
lump sum every 6 months, subject to discount. After the
5-year guaranteed period, you shall be entitled to a
monthly pension for life (if still living).
2. Initial 3-year lump sum
If you are at least 60 years old but less than 63 years old
on the date of retirement, the benefit is a 3-year lump
sum. The subsequent 2-year lump sum shall be paid to
you on your 63rd birthday. After the 5-year guaranteed
period, you shall be entitled to a monthly pension for life
(if still living).
3. 5-year lump sum
You can avail of it if you are at least 63 years of age on
the date of your retirement. If you are still living after the

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5-year guaranteed period, you shall be entitled to a

monthly pension for life (if still living).
Your monthly pension under RA 660 is computed as
follows:
R = P30.00 + [2%xM) + (1.2%xP)] (A)
where:
R = monthly annuity at age 57
A = average monthly salary for the last 3 years
M = number of years after 6/16/1951
P = number of years of service before 6/16/1951
Actuarial adjustment factors are used in computing for
the annuity benefit under RA 660. Refer to the table
below:
Table of actuarial adjustment factors
AGE
FACTOR

52
.87

53
.89

54
.92

55
.94

56
.97

57
1.00

58
1.03

59
1.0
6

60
1.08

61
1.1
1

62
1.15

63
1.1
6

64
1.20

Sample computation of RA 660

Basic Data
Name:
Office:
Date of Birth:
Date of entry in service:
Date of Retirement:
RCS:
AMC:
RAMC:

Juan Dela Cruz

DepEd Pulang Lupa
06/20/1947
03/01/1973
1/01/2009
.8657400
23,805.55
24,505.55

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Highest Salary Received:

Age at Retirement:

P25,000.00
1.52 y/o

Computation
R = P30.00 + [(2% x M)] + (1.2% x P)] ( A )
= P30.00 + (2% x 31.86574) (A)
= P30.00 + (.637315) (23,805.55)
= P30.00 + P15,171.63
= P15,201.63
Actuarial Factor at age 61.52 = 1.13
Automatic Annuity = P15,201.63 (1.13)
= P17,177.84
1 year lump sum = 12 x P17,177.84
= P 206,134.10
3 year lump sum = 36 x P17,177.84
= P 618,402.30
5 year lump sum = 60 x P17,177.84
= P 1,030,670.51

Presidential Decree 1146

Eligibility

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You must have been in the service after May 31,

1977 but retired/separated from the service prior to June
24, 1997.
Benefits
1. Old-age pension
You are entitled to an old-age pension if you are at least
60 years old and had at least 15 years of service at the
time of retirement. You have two benefit options to
choose from:
Option 1: Monthly annuity
Option 2: 5-year lump sum with discount
After the 5-year guaranteed period, you will receive an
old-age pension for life.
Your old-age pension is computed as follows if total
service is at least 15 years:
BMP =37.5% RAMC + 2.5 RAMC x (total years of
service - 15 years)
where the AMC is computed as follows:
AMC =
Total compensation received with
premium payments
during the last 3 yrs prior to date of
retirement/separation
________________________________________________
36 months

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and where the revalued average monthly compensation

(RAMC) is computed as follows:
RAMC=170% (AMC), if AMC is not more than P200
RAMC=AMC + P140, if AMC is more than P200 but
less than P3,000 (but in no case to
exceed P3,000)
2. Cash payment
If you are at least 60 years old and had at least 3 years
but less than 15 years of service, the cash payment (CP)
shall be equal to 100% of the AMC multiplied by the
record of creditable service.
Your CP is computed as follows:
CP = Record of creditable service x AMC, but not
less than P500
Sample computation of PD 1146
Basic Data
Name:
Office:
Position:
Date of Ret:
Date of Birth:
AMC:
RAMC:
RCS:

Pedro Jose
DepEd
Teacher 1
03/21/1996
03/21/1940
3,000.00
3,140.00
20.22146

Computation
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Option: 5 year lump sum

BMP

= (.025) (3,140.00) (20.22146)

= 1,587.38

5 year L/S:
Accrual Period:

04/01/2000 03/31/2005
= 60 x P1,587.38
= 95,242.80

Republic Act 8291 (GSIS Act of 1997)

I. Retirement benefits
Eligibility
1. You must have rendered at least 15 years of service
and must be at least 60 years old upon retirement.
2. You must not be a permanent total disability pensioner.
There are 2 options to choose from:
Option 1: Lump sum and old-age pension
Lump sum which is equivalent to 60 months of your BMP
payable at the time of retirement, and an old-age pension
benefit payable monthly for life if you are still living after
the 5-year guaranteed period.

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Option 2: Cash Payment and immediate monthly

pension
Cash payment (CP) is equivalent to 18 months of your
BMP payable upon retirement plus immediate monthly
pension for life payable from date of your retirement.
Your BMP is computed as follows if total service is at
least 15 years:
BMP = (0.025) x (AMC+ P700) x Record of
Creditable Service
where RAMC = AMC + P700
(In no case shall the BMP exceed 90% of the AMC)
The AMC is computed as follows:
1. If your length of service is less than 36 months:
AMC =
Total compensation received with
premium payments
preceding
unemployment/disability/death
______________________________________________
Actual number of months member received such
Compensation

2. If your length of service is 36 months or more:

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AMC =
Total compensation received for the
last 36 months
with premium payments
preceding
unemployment/disability/death
______________________________________________
36 months
Sample computation of RA 8291
Basic Data
Name:
Office:
Date of Birth:
Date of entry in service:
Date of Retirement:
RCS:
AMC:
RAMC:
Highest Salary Received:
Age at Retirement:

Juan Dela Cruz

DepEd Pulang Lupa
06/20/1947
03/01/1973
01/01/2009
31.8657400
23,805.55
24,505.55
P25,000.00
61.52 y/o

Computation
BMP

= (.025) (RAMC) (RCS)

= (.025) (24,505.55) (31.86574)
= P19,522.18

RETIREMENT BENEFITS:
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5 YEAR LUMP SUM

= 60 X P19,522.18
= P1,171,330.80
18 MONTHS CASH PAYMENT:
= 18 X 19,522.18
= P351,399.24
II. Separation benefit
This is CASH PAYMENT computed as follows:
If you have at least 3 years 100% of the AMC
but less than 15 years of
multiplied by the RCS
service and are below 60
payable at age 60.
years old
If you have at least 15
years of service and are
below 60 years old.

18 times the BMP

payable upon
separation, and monthly
pension for life starting
to commence a month
after the 60th birthday.

III. Unemployment benefit

You can avail of the unemployment benefit if you are
a permanent government employee who have paid the
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required 12 months integrated contributions under RA

8291 and are involuntarily separated from the service as
a result of the abolition of your office or position usually
resulting from reorganization.
The benefit is in the form of monthly cash payment
equivalent to 50% of your AMC. The duration of the
benefit depends on the length of your service and ranges
from 2 months to a maximum of 6 months.
The unemployment benefit shall
accordance with the following schedule.
Contribution Made
1 year but less than 3 years
3 or more years but less than
6 years
6 or more years but less than
9 years
9 or more years but less than
11 years
11 or more years but less
than 15 years

be

paid

Amount of
Benefit
2 months
3 months
4 months
5 months
6 months

IV. Disability benefits (Nonwork-connected)

You may avail of disability benefits in case of loss or
reduction of your earning capacity caused by loss or
impairment of the normal functions of your physical
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and/or mental faculties as a result of an injury or

sickness.
The Medical Services Group of the GSIS determines
the nature of your disability and the corresponding
benefits on the basis of the following:
1. Permanent Total Disability (PTD)
Condition
If you are in active
service and has less than
15 years of service

Benefit
Monthly pension a month
after retirement

If you are in active

service and has at least
15 years of service
If you are separated from
the service and had 36
monthly contributions
within the 5-year period
immediately preceding
the PTD

BMPx18 plus pension

immediately a month
after retirement
BMP

2. Permanent Partial Disability (PPD)

If you are either in the service or separated from the
service, have paid 36 monthly contributions within the
last 3 years immediately preceding the PPD, or have paid

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at least 180 monthly contributions, you are entitled to

cash payment computed as follows:
CP = BMP x Number of PPD months
(as recommended by the GSIS medical evaluator)
3. Temporary Total Disability (TTD) or Sickness
Income Benefit (SIB)
You are entitled to TTD or SIB if you are in the
service. If you were separated from the service, you
must have rendered at least 3 years of service and have
paid at least 6 monthly contributions within 12 months
immediately preceding the TTD.
Your SIB range from P165.00/day to a maximum of
P475.00/day:
1.

The duration of the disability or sickness must

not exceed 120 days.

2.

In extensive cases, the benefit may be

extended up to a maximum of 240 days.

V. Survivorship benefit (under RA 8291)

Survivorship pension
The newly constituted GSIS Board of Trustees issued
a resolution on December 8, 2010 that allows surviving
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spouses of members and pensioners to receive their

monthly survivorship pension even if they are gainfully
employed and receiving other sources of income.
The basic survivorship pension payable to the
surviving spouse is equivalent to 50% of the basic
monthly pension received by deceased member or
pensioner, but the maximum limit for the survivorship
pension is subject to the approval of the GSIS Board of
Trustees.
Payment of the BSP to the dependent spouse shall be
discontinued in case the latter remarries, cohabits, or
engages in a common-law relationship.
Funeral benefit
Qualified to receive the funeral benefit are the
following:
an active member;
those who have been separated from the service
but is entitled to future separation or retirement
benefit;
an old-age pensioner (excluding survivorship
pensioners)
those who are at least 60 years old at the time of
retirement but opted to retire under RA 1616 after
the effectivity of RA 8291;
those who retired under RA 1616 prior to the
effectivity of RA
8291 or the GSIS Act of 1997 with at least 20
years of service
regardless of age.
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The funeral benefits worth P20,000.00 will be paid to

the legitimate spouse or legitimate child of the deceased
member, pensioner, and gratuitant, or any person who
spent for the funeral and can show incontrovertible proofs
of his/her having borne the funeral expense.
Republic Act 7699
Portability Law
(Effective May 1, 1994)
You can avail of the benefits under the Portability Law if,
1. You are not entitled for pension benefit in either or
both System (GSIS or SSS);
2. You have contributed for less than 120 months of SSS
contributions or less than 180 months of creditable
government service at the time of retirement.
Provided, there is no overlapping of SSS contributions
and government service.
The benefit under portability law is in the form of monthly
annuity or pension payable at the age of 60. However,
the amount of benefits to be paid by one system shall be
proportionate to the services you rendered with premium
payments or the period of contributions you have
remitted.
Life insurance coverage
The GSIS administers two types of life insurance
policy. These are the Life Endowment Policy or LEP and
the Enhanced Life Policy or ELP.

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Life Endowment Policy

LEP is the old insurance coverage of GSIS members.
Benefits of LEP:
Maturity of benefits
Cash surrender value
Permanent total disability
Death benefit
Accidental death
Annual dividends
Policy loan loanable amount is equivalent to 50% of
the cash value
Enhanced Life Policy
You are covered by ELP if you are:
1. A government employee who entered the service
after July 23, 2003
2. An existing regular GSIS member who will opt to
convert your existing LEP into ELP
3. An existing regular GSIS member whose LEP lapsed
by reason of nonpayment of life insurance premiums
and whose policy matured on or after August 1,
2003. You will be issued the ELP if you contiinue to
be in active service
Benefits of ELP:

Death benefits equivalent to the last annual

salary multiplied by 1.5

Termination value equivalent to 25% of the

monthly
life
insurance
premium
paid.
The

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termination value can be withdrawn upon separation

or retirement

Annual dividends based on the termination value

Policy loan loanable amount is equivalent to

90% of the terminal value
Additional Social Security Benefits
Christmas cash gift
Old-age pensioners and disability pensioners under RA
660,PD 1146, or RA 8291 receive Christmas cash gift
equivalent to a one-month pension but not to exceed the
maximum limit approved by the GSIS Board of Trustees.
However, old-age pensioners who have less than 15
years of Record of Creditable Service (RCS) when they
retired are not entitled to Christmas cash gift.
Increase in pension
Old-age pensioners receive increase in pension. The
rate of increase is subject to the approval of the GSIS
Board of Trustees.
However, EC and survivorship pensioners are not
entitled to this benefit.

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