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Retiree seeks answers to questions regarding pension, insurance

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RETIREE John “Jack” Angello is seeking answers to the following questions:

1) Why can't we retirees have our life insurance payout based upon our full 100% pension instead of 75%?

2) Is it possible that retirees get paid the 25% of our pension that was deducted three times in April and May?

“We were deducted because of Public School System’s financial problems and they have been made whole, so what about us manamko’/retirees?” Angello asked.

He said Settlement Fund trustee Joyce Tang informed him that he should contact the Department of Finance, and “I have three times since February with no response.”

Angello said the retirees' life insurance program is an important issue for retirees and their families, “and the payment of the 25% loss of our pension for three periods would help us manamko’ in this time of need.”

Angello said on Feb. 18, he updated his IAC life insurance policy, but noticed that his beneficiaries’ payout would be based on 75% of his total retirement benefits.

“I asked why this payout would be reduced since I have been regularly receiving 100% of my benefits,” Angello said.

He added that the IAC management told him that it was the decision of the Department of Finance to reduce the retirees’ life insurance payouts.

He then inquired if he could pay for the difference.

“IAC stated that it’s a group policy and [Finance] would need to make a simple amendment to the policy,”  Angello said.

He said Tang told him that “unfortunately, there is nothing the SF can do on your behalf because the SF does not administer life insurance benefits.”

She said Finance oversees the administration of the life insurance benefits. “We can only advice you to contact Secretary of Finance David Atalig, regarding your life insurance payout.”

In 2009, retiree Betty Johnson sued the CNMI government for its failure to pay the amounts that it was required by law to pay to the Retirement Fund since 2005.

In Sept. 2013, the parties agreed to settle the lawsuit and the U.S. court approved a $779 million consent judgment in case the government does not meet its obligations to the Settlement Fund.

The Settlement Fund was created by the federal court as part of the settlement between the CNMI government and the retirees.

Under the settlement agreement, the government must pay 75% of the retirees’ benefits.

With the improvement of the economy due to the entry of new investors and a rise in tourism arrivals, the CNMI government had also been paying the 25% of the retirees’ benefits.

However, Super Typhoon Yutu, which hit Saipan and Tinian in Oct. 2018, and the ongoing Covid-19 crisis have significantly weakened the local economy, resulting in a steep drop in government revenue.

 

 

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