GSIS 2008 Annual Cash Dividends Distribution

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GSIS NO. 206: GSIS 2008 Annual Cash Dividends Distribution

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Title Supreme Court: GSIS 2008 Annual Cash Dividends Distribution

Law: Gsis No. 206

Decision Date: Dec 17, 2008

In December 2008, the GSIS approved the distribution of P950 million in annual cash dividends to active compulsory life insurance policyholders, contingent on their policies being in force for at least one year and meeting specific eligibility criteria.

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Entitlement to Dividends

Active members, including Judiciary and Constitutional Office members, covered by Life Endowment Policy (LEP) or Enhanced Life Policy (ELP) for at least one year as of December 31, 2007, are entitled.
Members whose LEP matured after December 31, 2007, and were issued renewal ELP are entitled based on LEP.
Members who converted LEP to ELP after December 31, 2007, are entitled based on LEP.

Members Not Entitled to Dividends

Active members who defaulted on consolidated loans and salary loans for 12 months or more, or have unpaid premiums for at least 12 months as of declaration date.
Policies that lapsed in 2007 up to the declaration date.
Policies terminated due to retirement, maturity, or separation in 2007 as of declaration date.

Funding and Payment Method

The PHP 950 million dividend outlay shall be charged against the Social Insurance Fund surplus.
Dividends will be disbursed through the GSIS E-Card system.

Operational Guidelines and Responsibilities

The IT Services Group (ITSG) shall coordinate the payment phasing with Operations and Treasury.
ITSG to generate listings of policies not entitled to dividends (lapsed, terminated, defaulted loan/premium).
ITSG to prepare listings of policies with Automatic Premium Loan (APL) and amounts.

Calculation Formulas for Cash Dividends (Annex 1)

Variables include terminal reserve (tVx), cash dividend factor (Fx), mortality rate (q), termination value (TVx), and APL.
Different formulas apply depending on policy type:
- Pure Endowment: Fx = .0165 * tVx - .0165 * APL
- Other Insurance Plans (including LEP converted to ELP): Fx = .0165 * tVx + 0.478 * q_x+t-2 * (1,000 - tVx) - .0165 * APL
- Enhanced Life Policies: Fx = 0.0165 * tTVx - 0.0165 * APL

Mortality Tables Used for Calculations

Justices' Life Insurance: Hunter's Mortality Table at 4% for all applicable policies.
Other Members' Insurance:
- Issued prior to June 1, 1977: same as Justices'
- Issued on or after June 1, 1977: 1958 CSO at 4% for all plans

Information Dissemination Directive

The Executive Vice President (Corporate Support Sector) and the Vice President (Public Relations and Communications Office) are tasked to inform members about the 2008 dividend grant and its increased benefits compared to previous years.

END