C A R L ET O N FINANCIAL GROUP

2011 Reference Guide

to Canadian Benefits

Compliments of

CARLETON FINANCIAL GROUP

For Your Reference

CFG Inc. has prepared this reference booklet to provide you with a summary of benefits available from government sponsored sources and legislation for 2011. Although the information provided is current at the time of publication, you should be aware that legislated benefits may change throughout the year. For more detailed information please consult your legal advisor, or CFG. An electronic copy of this Guide and additional Carleton Financial Group resources such as our newsletter, industry links, employee handouts and financial calculators are available on our website: www.carletonfinancial.com.

About CFG
Carleton Financial Group is an independent consulting firm specializing in providing group benefits and pension solutions for small to medium sized companies. Carleton Financial Group can help your organization benefit from an effective and efficient group plan. We specialize in: Employee Benefits and Pension Consulting Succession Planning Tax Minimization Strategies Retirement and Estate Planning Visit us online at www.carletonfinancial.com.

Carleton Financial Group Inc. 2011 Canadian Benefits Guide

This guide is intended as a reference tool to provide you with an overview of available Federal and Provincial benefits. All information is current at the time of publication, but may change throughout the year. Where available, web sites are shown for further assistance. page Employment Insurance Regular and Special Benefits Premium Rates for EI Quebec Parental Insurance Plan (QPIP) Premium Reduction Program Supplemental Unemployment Benefit (SUB) Plans 1 2 3 4-6 6-7 Retirement Income Plans Old Age Security Canada/Quebec Pension Plan Registered Retirement Savings Plans/ Registered Pension Plans (RRSP/RPP) Contribution Limits Withholding Tax page 8-10 10-13 14 15 16

page CPP Disability Benefits Workers Compensation Benefits Provincial Medicare Programs Hospital Coverage Medical Care Prescription Drugs Dental Vision Contributions 17-18 19 Taxation Life and Health Insurance Premiums Harmonized Sales Tax (HST) Sales Tax on Group Insurance Plans Tax on Employee Assistance Programs 20 21 21-23 24 24 25-26 Employer Contributions to Group Insurance Benefits Naming a Beneficiary

page 27 27 28 28 29 30-32

Employment Insurance
Regular and Special and Compassionate Care Benefits

Regular EI Benefits are paid to workers who have lost their jobs and are available for work, but due to circumstances, cannot find employment. Special Benefits are paid to those who have left work due to sickness, maternity or parental leave. Compassionate Care Benefits are paid to workers who leave work to care for a gravely ill relative. Maximum Insurable Earnings Benefit Level and Maximum Minimum Number of Hours Required Regular Benefits Special Benefits Compassionate Care
$44,200 annually. 55% of average weekly insurable earnings to a maximum of $468 per week. Claimants with children and a family income under $25,921 per year will be entitled to a family income supplement. 420 to 700 depending on unemployment rate in their region, except for new entrants or re-entrants (after 2 or more years), who require a minimum of 910 hours for regular benefits; 600 hours of employment for special benefits. Maximum of 45 weeks (depending on regional unemployment rate) for regular benefits. 50 weeks with compassionate care. 65 weeks with special benefits. Sickness: 15 weeks Maternity: 15 weeks Parental Benefits: 35 weeks / natural and adoptive. 65 weeks total when combined with regular benefits, except in Quebec. 6 weeks. 50 weeks if combined with regular benefits. 71 weeks if combined with special benefits.

Premium Rates for EI - All of Canada, except Quebec

Year Maximum Insurable Earnings $42,300 $43,200 $44,200 Rates per $100 of Insurable Earnings Employee 1.73 1.73 1.78 Employer* 2.42 2.42 2.49 Annual Contribution Maximum Employee $731.79 $747.36 $786.76 Employer* $1,024.51 $1,046.30 $1,101.46

2009 2010 2011

*1.4 times the employee premium

Premium Rates for EI - Quebec

Rates in Quebec are less than the federal EI rates because Quebec employees and employers with employees in Quebec also contribute to the Quebec Parental Insurance Plan (QPIP). Premiums are a combination of the federal EI rate noted below plus the QPIP rate. See next page for the QPIP rates and information.

Year

Maximum Insurable Earnings $43,200 $44,200

Rates per $100 of Insurable Earnings Employee 1.36 1.41 Employer* 1.90 1.97

Annual Contribution Maximum Employee $587.52 $623.22 Employer* $822.53 $872.51 2

2010 2011

*1.4 times the employee premium

Quebec Parental Insurance Plan (QPIP)

The QPIP provides benefits similar to the EI benefits, with some additions and modifications. Employees choose from either the Basic or Special plan which provides a percentage of average weekly income. Benefits are as follows:
Maternity - for mother only Paternity - for father only Parental - for mother and/or father Adoption - for mother and/or father Basic: 18 weeks of benefits at 70% Special: 15 weeks of benefits at 75% Basic: 5 weeks of benefits at 70% Special: 3 weeks of benefits at 75% Basic: 32 weeks of benefits. First 7 weeks: 70% remainder: 55% Special: 25 weeks of benefits at 75% Basic: 37 weeks of benefits. First 12 weeks: 70% remainder: 55% Special: 28 weeks of benefits at 75%
There is no waiting period before benefits begin.

Year

Maximum Insurable Earnings $62,500 $64,000

Rates per $100 of Insurable Earnings Employee $0.506 $0.537 Employer $0.708 $0.752

Annual Contribution Maximum Employee $316.25 $343.68 Employer $422.50 $481.28

2010 2011

*This QPIP contribution is in addition to the EI annual contribution displayed on the previous page.

Premium Reduction Program

Under the Employment Insurance (EI) Act and the EI Regulations, an employers EI premiums may be reduced when employees are covered by a qualified short-term disability plan which reduces EI benefits that would be payable if such a plan did not exist. The employer must demonstrate that the short-term disability plan meets certain standards. To qualify for a reduction, the employer must: Apply for a reduction Provide short-term disability coverage that meets the requirements of the Program Demonstrate that at least five-twelfths of the reduction will be passed on to the employees covered by your approved plan Remit to Canada Revenue Agency (CRA) under separate payroll deduction accounts, if necessary The reduction for a registered and approved short-term disability plan with a maximum payment period of at least 15 weeks, compares as follows: Category Employee Premium Employer Premium Multiple Without Registered W.I. Plan Employer Premium Multiple With Registered W.I. Plan 2011 Rate $1.78 per $100 of Insurable Earnings ($1.41 in Quebec) 1.4 times the employee premium 1.181 times the employee premium (1.123 in Quebec) 4

Employers with employees both in and out of Quebec can obtain new premium rates by calling 1-800-561-7923.

Premium Reduction Program (contd)

For employers who offer Paid Sick Leave Plans that provide coverage based on sick leave credits accumulated by employees, the plan must also meet the following qualifications in order to qualify for a premium reduction, namely, the plan must pay benefits until at least the earliest of the following: the payment of 75 days of sick leave, 125 in the case of an Enhanced plan; or the exhaustion of all accumulated paid sick leave; or the period of incapacity due to illness or injury has ended; or the employee has retired; or the date of separation for any reason other than illness or injury if the notice of separation was given prior to the beginning of the illness or injury.

A Paid Sick Leave Plan must provide coverage for the health related portion of maternity leave typically six to eight weeks. It may also provide for parental benefits. Partial reductions based on reduced multiples will apply for plans qualifying on the previous basis. For detailed information about the Program, its requirements and how to apply for a reduction, please refer to: www.hrdc.gc.ca.

Supplemental Unemployment Benefits (SUB)

This program allows employers to register SUB plans that meet certain requirements set by Human Resources and Skills Development Canada (HRSDC). The purpose of the SUB plan is to provide supplemental payments to EI benefits during a period of unemployment due to temporary stoppage of work, training, illness, injury or quarantine. Payments provided by employers, to supplement maternity and parental benefits do not require formal approval from HRSDC and are not included in this SUB Program excerpt.

Supplemental Unemployment Benefits (contd)

All other SUB Plans must meet the following basic requirements:
Require the employee to be in receipt of EI benefits before SUB payments are made. Be intended for temporary unemployment. Be entirely financed by the employer. Provide for a benefit that will not exceed 95% of the employees weekly earnings when the SUB payment is added to the EI benefit rate (not to exceed 100% of weekly earnings during maternity, parental, or compassionate care leave). Be registered with HRDC before its effective date. Payments from unregistered SUB plans will be considered as earnings and may reduce the employees EI benefits.

Retirement Income Plans

Canadas retirement income system provides benefits on three distinct levels; Old Age Security (OAS), Canada/Quebec Pension Plan (CPP/QPP) and Private Pension and Savings (RRSP and RPP). See www.servicecanada.gc.ca, and follow the links to Seniors.

Old Age Security

The plan provides: Basic benefits for most people age 65 and older and are taxable to the recipient. Guaranteed Income Supplement (GIS) an additional non-taxable monthly benefit for low-income OAS pensioners. A non-taxable Allowance for low-income spouses or common-law partners (between the ages of 60 and 64) of OAS pensioners providing the pensioners are or were eligible to receive both OAS and GIS. The Government of Canada pays OAS benefits from general tax revenues. To qualify for OAS benefits an individual must be 65 and a resident of Canada for at least 10 years after his/her 18th birthday. Special provisions apply to immigrants from countries that have international social security agreements with Canada. Basic OAS benefits can only be paid outside Canada if the individual has lived in Canada for at least 20 years after his/her 18th birthday. GIS and Allowance cease if the individual leaves Canada for more than six months. If persons return to Canada they must re-apply. 8

Maximum Monthly OAS Benefits January - March 2011

(Benefits are adjusted for inflation every January, April, July and October. To find out current amounts, call 1-800-277-9914)

Benefit

Maximum Monthly Benefit $524.23 $961.18 $1,065.45 $661.69 $661.69 $436.95 $436.95

Maximum Annual Income* See Note** $29,376 $21,408 $15,888 $38,112 $20,976 $38,112

Old Age Security Pension (age 65 and over) Allowance (age 60-64) Allowance for Survivor Guaranteed Income Supplement Single Spouse of non-pensioner Spouse of pensioner Spouse of allowance recipient

*Pensioners are not eligible for benefits if their income, or the combined income including their spouse, is more than the maximum shown. **Note: Pensioners with an individual net income above $67,688 per annum must repay part or all of the maximum Old Age Security pension amount. The full pension is eliminated when net income is $109,607 or more.

Maximum Monthly OAS Benefits (contd)

Provincial and territorial governments also offer a variety of benefits and programs to assist seniors. This varies by province or territory and may include for example, income, transportation and housing assistance, health care programs, tax assistance and in some cases, social assistance. For more information on these benefits, visit the HRSDC web site www.servicecanada.gc.ca.

Canada Pension Plan/Quebec Pension Plan (CPP/QPP)

The plan provides: monthly retirement benefits to people who have worked and contributed to the Plan; a monthly income to a covered individual including their dependent children in the event of a severe disability during working years (see Page 17 CPP Disability Benefits for further information); a monthly income to your surviving spouse or common-law partner and dependent children in the event of death; and, a lump-sum death benefit to individuals estate in the event of death.

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Canada Pension Plan/Quebec Pension Plan (CPP/QPP) (contd)

Contributions are deducted from the members pay subject to a minimum and maximum amount and are matched by the employer. Generally, all workers in Canada over the age of 18 pay into the plan and qualify for benefits. Benefit payments are taxable. The normal age to start receiving a retirement pension is 65. However, pension can start as early as 60 or as late as 70. If pension is elected before 65, the individual must stop working or earn less than a specified amount for a required period of time. If pension is elected early, it is permanently reduced by 0.5% for each month that the individual is under 65 and increased by 0.5% for each month the individual is over 65, up to age 70. For more information on CPP/QPP, visit www.servicecanada.gc.ca.

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Contributions - 2011
CPP and QPP Years Maximum Pensionable Earnings (YMPE) Years Basic Exemption (YBE) Maximum Annual Contribution Rate* -employee -employer -self-employed Maximum Annual Contribution -employee -employer -self-employed * Percentage of employment earnings up to the YMPE less YBE 12 $48,300 $3,500 4.95% 4.95% 9.9%

$2,217.60 $2,217.60 $4,435.20

Maximum Monthly Benefit - 2011

Type of Benefit
Retirement Pension (at age 65) Disability Benefit -contributor (maximum) -each child Survivor Benefit (spouse)* -65 and older -64 and under (maximum) -under 45 (disabled) -under 45 (not disabled with dependent child) -under 45 (not disabled without dependent child) Orphan Benefit Death Benefit (maximum lump-sum) * May differ for survivor on regular or disability pension.

13 CPP
$960.00 $1,153.37 $218.50 $576.00 $529.09 $529.09 $529.09 $529.09 $218.50 $2,500.00

QPP
$960.00 $1,153.34 $69.38 $576.00 $793.34 $793.34 $762.35 $470.98 $69.38 $2,500.00

Registered Pension Plans (RPP), Registered Retirement Savings Plans (RRSP) and Deferred ProfitSharing Plans (DPSP), and Tax Free Savings Accounts (TFSA).
Contributions to RPPs, RRSPs, and DSPSs are tax deductible and investment income is not taxed until the funds are withdrawn or received as pension income. TFSA contributions are made after taxes. Withdrawals and investment growth are tax free. Registered Pension Plans (RPP): Employer sponsored plans registered with Canada Customs and Revenue Agency and the appropriate federal or provincial regulatory authorities. Registered Retirement Savings Plans (RRSP): Individual, personally managed savings plans and can be set up through most financial institutions. Deferred Profit-Sharing Plans (DPSP): Plans set up by an employer into which contributions are made for employees, based on the companys profits up to a specified maximum. Tax Free Savings Accounts (TFSA): A savings mechanism that can be set up on an individual basis at most financial institutions or on a group basis through an employer. 14

Maximum Contribution Limits for RRSPs, Defined Contribution RPPs and DPSPs 2011
RRSP
Lesser of 18% of prior years earned income or $22,450 minus the PA* plus any unused RRSP contribution room

15

2012
Lesser of 18% of prior years earned income or $22,970 minus the PA* plus any unused RRSP contribution room

Defined Contribution RPP DPSP**

Lesser of 18% of compensation or $22,970 .

Prior year limit indexed to the Average Industrial Wage after 2011. Prior year limit indexed to the Average Industrial Wage after 2011. Prior limit indexed to the inflation rate. Unused contribution and withdrawal amounts carried forward.

Lesser of 18% of compensation or $11,485.

TFSA***

$5,000. Unused contribution and withdrawal amounts carried forward.

* A Pension Adjustment (PA) applies to members of an RPP or DPSP and reduces his or her RRSP contribution level. **Employees cannot contribute to a DPSP. The maximum an employer can contribute is 50% of an individuals defined contribution RPP amount. ***The annual TFSA dollar limit will be indexed to the inflation rate. The contribution limit will be increased only when the cumulative indexing results in an increase rounded to the nearest $500 increment.

Withholding Tax
Withholding tax on lump-sum and RRSP payments:

Amount

Provinces Other Than Quebec Federal Tax

Quebec Federal Quebec Tax 5% 16% 10% 15% 20% 20%

Up to $5,000 $5,001 to $15,000 Over $15,000

10% 20% 30%

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CPP Disability Benefits

The Plan pays a monthly benefit to people who have contributed to the Plan and who are disabled according to legislation. It also pays monthly benefits for dependent children. To qualify, the individual must: Have contributed to the Plan in four of the last six years and during that period have earned at least 10% of each years Maximum Pensionable Earnings (YMPE). In Quebec, at least two of the last three years; five of the last ten years; or at least half of the years in the individuals contributory period (minimum two years). Be disabled due to a condition which is deemed severe and prolonged. Be under the age of 65. Apply in writing.

17

CPP Disability Benefits (contd)

CPP Waiting Period Monthly Payment - Contributor

Four Months

QPP
Four Months

A flat amount of $433.37 (CPP) or $433.34 (QPP) plus 75% of retirement pension. Maximum $1,153.37 (CPP) and $1,153.34 (QPP).

- Child (under 18)

$218.50

$69.38

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Workers Compensation Benefits

19

Wage loss, permanent disability and survivor benefits are available to claimants as a result of work-related injury or disease legislation is specific to each province and territory. Employer contributions are calculated as a percentage of insurable earnings and vary by province and territory. Visit the Association of Workers Compensation Board of Canada web site at www.awcbc.org for links to WCBs across Canada. Province Alberta British Columbia Manitoba New Brunswick Newfoundland NWT/Nunavut Nova Scotia Ontario Prince Edward Island Quebec Saskatchewan Yukon Percent of Earnings 90% of net 90% of net 90% of net 85% of net 80% of net 90% of net 75% of net 1st 26 weeks, then 85% 85% of net 80% of net 1st 38 weeks, then 85% 90% of net 90% of net 75% of gross Maximum Assessable Earnings $82,800 $71,700 $96,000 $56,700 $51,595 $82,720 $52,000 $79,600 $47,800 $64,000 $55,000 $77,920

Provincial Medicare Programs

The Canada Health Act (CHA) ensures that all residents of Canada have access to medically necessary hospital, physical and extended health care services based on need, rather than ability to pay. All provinces and territories provide, at their discretion and on their terms and conditions, a range of health services that go beyond the CHA. For information on these services, visit the CHA web site www.hc-sc.gc.ca/medicare and click on LINKS for each provincial health care site.

Hospital Coverage
All provinces provide room and board to the ward level, surgical facilities, in-hospital nursing, drugs and diagnostic services. An additional cost for semi-private and private accommodation applies, which varies by province (Note: charges in Alberta, Manitoba, Quebec, PEI and Newfoundland are legislated). Emergency Out-Of-Country expenses are also covered, but to limited levels (e.g. in Ontario the maximum payment for hospitalization is $400 CDN per day and $50 for out-patient services). 20

Medical Care

21

Provincial Medicare programs cover medically necessary services provided by physicians based on an approved fee schedule. Other private practitioners (i.e. chiropractors, podiatrists, physiotherapists, etc) may be covered on a limited basis. Varying levels of coverage are also available while temporarily traveling out of province.

Prescription Drugs (out of hospital)

Varying levels of coverage are available to seniors and lower income persons based on a provincial drug list. See the listing on the following pages.

Summary of Coverage for Prescription Drugs Province Alberta British Columbia Manitoba New Brunswick Newfoundland Under age 65
Supplementary provincial health coverage available for quarterly cost. Provides drug coverage at 70% to a maximum out-of-pocket of $25 per prescription. 70% after deductible of 0%-3% of family income; 100% after out-of-pocket 2%-4% of family income.

Age 65 and over

70% maximum out-of-pocket $25 per prescription.

75% after deductible of 0%-2% of family income; 100% after out-of-pocket 1.25%-3% of family income.

100% after deductible of 2.71%-6.12%, depending on adjusted total annual family income. Deductible based on income. Some coverage for certain situations. If qualify, $15/drug deductible, based on annual income.

The Assurance Plan is for residents with a net family income of less than $150,000. These families are eligible for coverage with a deductible of 5% - 10%, depending on income.

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23

Summary of Coverage for Prescription Drugs

Province Under age 65 Age 65 and over
The Nova Scotia Family Pharmacare program provides coverage when drugs have become a financial burden. No premiums.

Nova Scotia

Optional with premium payment of $424 per year. Co-pay: 30% up to a maximum per prescription cost of $30. $382 annual out-of-pocket maximum. Individuals without private coverage (second pay or otherwise) deductible based on income and number of dependents (varies). The Family Health Benefit Program helps families with children with drug costs. Eligibility depends on family size and income. Low income $2 per drug Others: Deductible of $6.11 per drug after first $100 per year out-of-pocket.

Ontario Prince Edward Island Quebec (Updated every July 1st) Saskatchewan

100% after deductible of $8.25/drug plus dispensing fee.

Individuals without group coverage: 68% after monthly deductible of $16.00/adult,to a monthly maximum of $80.25 ($963 per annum). 100% coverage after monthly maximum. Qualify for assistance if drug costs exceed 3.4% of family income. Under age 15, province pays cost of prescription above $15. Seniors pay maximum of $15 per prescription; 100% of remainder of cost is covered by province.

Dental Care
There is limited coverage in some provinces for children, seniors, and low income individuals who meet minimum requirements.

Vision Care
Eye examinations are covered in the following provinces once every year unless noted:

Province Ontario Alberta, British Columbia Manitoba Quebec Nova Scotia Saskatchewan All Others

Coverage
Under age 20 and age 65 & older (Once every 12 months) Under age 19 and age 65 & older Under age 19 and age 65 & older (Once every 24 months) Under age 18 and age 65 & older Under age 10 and age 65 & older (Once every 24 months) Under age 18 No Coverage 24

Note: Special coverage may be provided for low income individuals or under certain medical conditions.

Contributions
These services are supported in part by Canada Health and Social Transfer and in part by contributions of employers and residents of the various provinces.

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Province
Alberta (Alberta Health Care Insurance Plan) British Columbia (Medical Services Plan of British Columbia) Manitoba (Manitoba Health)

Premium / Taxes
Premiums for residents eliminated on January 1, 2009. $60.50 single, $109 family of 2, $121 family of 3 and over, per month. Subsidies available for low income. Employer payroll tax: Greater than $2,500,000 - 2.15% $1,250,000 - $2,500,000 - 4.30% Under $1,250,000 - 0% Employer payroll tax: Greater than $1,000,000 -2% Under $1,000,000 - 0% The 2% tax is applied after an exemption of up to $1,000,000

Newfoundland and Labrador (Newfoundland Medical Care Plan)

Contributions (contd) Province

Ontario (Ontario Health Insurance Plan)

Premium / Taxes
Employer payroll tax: Greater than $400,000 - 1.95% Under $400,000 - 0% Ontario Health Premium paid as follows: Taxable income of $20,000 or less: no premium charge Taxable income of $20,000 or more: Maximum of $900 per year, depending on income level.

Quebec (Quebec Health Insurance Plan)

Employer payroll tax: Greater than $5,000,000 - 4.26% $1,000,000-$5,000,000 - reduced rate between 2.7% and 4.26% Under $1,000,000 - 2.7%

All other provincial plans are supported from general revenues.

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Taxation
Life and Health Insurance - Premium Tax Nova Scotia Newfoundland Prince Edward Island Quebec Saskatchewan All Others
3% of net* premiums 4% of net* premiums 3.5% of net* premiums 2.55% of net* premiums Combination of: 3% of net* premiums 2% of net* premiums
Does not affect group benefit plans with an insured component EXCEPT for:

27 Harmonized Sales Tax (HST)

Applies to: Federal place of supply rules, published on June 9/10 and retroactive to May 1/10, affect employers with operations in more than one province. The rules determine whether an employer is charged HST or GST.

ON, BC, NB, NS, NL

GST (5%) + provincial sales tax (varies by province) - When GST only rules apply - The expenses portion of Administration Services Only (ASO) plans where there is no stop loss. - EAPs see chart on the next page for details HST calculation depends on various factors. For questions about HST and its application to your group retirement program, contact CFG.

*Net premiums defined as gross premium less dividends or surplus

For Group Retirement: Applies to Investment Management Fees (IMFs) and Annual Member Fees

Call 1-800-959-5525 or visit www.cra.gc.ca for more information on GST/HST.

Sales Tax on Group Insurance Plans

Applicable based on corporate site locations

Tax on Employee Assistance Programs

Applicable based on corporate site locations

Ontario Quebec All Other

8% on net group insurance cost 9% on net group insurance cost Not applicable

Quebec
New Brunswick Nova Scotia Newfoundland & Labrador

13.5% (8.5% QST + 5% GST)

This reflects the taxation on most insured and self-insured programs, however, some variations exist.

HST (sales tax + 5% GST) 5% GST

All Other

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Employer Contributions to Group Benefits

29

Group Benefit Employee Life Insurance Dependent Life Insurance AD&D Short Term Disability Long Term Disability Medical Dental Health Spending Account Critical Illness

Is the Premium Taxable to Employees Yes Yes No - Yes in Quebec No No No - Yes in Quebec No - Yes in Quebec No - Yes in Quebec No - Yes in Quebec

See www.cra.gc.ca for further information.

Naming A Beneficiary
Beneficiaries are persons named by an individual to receive the life insurance proceeds upon his/her death. An employee generally may nominate anyone he/she wishes as a beneficiary. All beneficiary nominations are revocable unless the employee designates in writing that the beneficiary is irrevocable, or laws in effect at the time of the nomination have rendered it irrevocable. An irrevocable beneficiary cannot be revoked or changed without the written consent of the named beneficiary.

Irrevocable Designations
In Quebec, beneficiary designations of married spouse is irrevocable unless otherwise stipulated. An irrevocable beneficiary may be designated in any province by adding a notation that the designation is irrevocable. However, while the beneficiary is living, the designation cannot be revoked or altered without the consent of the beneficiary (an irrevocable designation persists even if the policyholder changes carriers).

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Naming Two or More Beneficiaries

31

List the names of each beneficiary and the percentage of the proceeds each should receive: e.g. John Smith, Mary Smith each to receive an equal percentage John Smith to receive 75%, Mary Smith to receive 25% (If different percentages are directed to each beneficiary, the total must be 100%) Use the words primary beneficiary and secondary beneficiary to stipulate that the proceeds go to the primary beneficiary unless deceased, in which case the proceeds should go to the secondary beneficiary.

Minor Beneficiary
Where the beneficiary is a minor, Trustee or Guardian of the Estate of the minor should be appointed. In the absence of a Trustee or Guardian, the proceeds may be paid into Court or held until the minor is of legal age.

Estate as Beneficiary
When naming estate as a beneficiary, an individual should be aware that proceeds of the life insurance may be exposed to creditor claims, probate fees and in some cases estate taxes. It is important that plan members refer questions regarding wills, trustees or estate planning to a legal or financial advisor.

Notes