Title
GSIS Guidelines on Reclassified Members Claims and Loans
Law
Gsis No. 47
Decision Date
May 23, 2013
GSIS Resolution No. 47 establishes uniform guidelines for processing claims and loan privileges for government employees reclassified from regular to special members, clarifying their entitlements to life insurance benefits and specific loan options while ensuring compliance with applicable retirement schemes.
claims processing
loan privileges
special members

Legal basis and member classification

  • Republic Act No. 8291 (GSIS Act of 1997) is the governing statute distinguishing regular members and special members.
  • Regular members are required to remit life insurance and retirement premium contributions, and they may avail of GSIS service loans.
  • Special members are those covered by separate retirement schemes and are required to remit life insurance premiums only.
  • Special members are not entitled to GSIS service loan privileges unless their agency executes a special agreement with GSIS.

Purpose and policy objectives

  • The PPG establishes an orderly, uniform interpretation and implementation of policies for processing claims and loan privileges of reclassified GSIS members.
  • The PPG provides guidelines on special members’ entitlement to consolidated loans and policy loans, and to retirement and separation benefits.
  • The PPG provides remedies for cases where members were unduly classified as special members without legal basis and without DBM confirmation, resulting in incorrect premium remittances.

Definitions and membership status

  • Regular members are those required, together with their employing government agencies, to remit life and retirement premium contributions mandated under Section 5 of RA 8291.
  • Special members are those covered by the Constitution or a special law/Charter and are under separate retirement schemes funded by their own agency or by the National Treasury and recognized by the DBM.
  • Regular membership ends on the day immediately preceding reclassification to special membership.
  • Special membership begins only upon formalization through issuance of a new life insurance policy under Commonwealth Act No. 186, as amended.

Coverage and when special membership starts

  • Coverage is limited to DBM-recognized designations or positions covered by special retirement laws other than RA 8291 (with a complete list referenced as Annex A).
  • If a government employee is not covered by DBM-recognized designations/positions under the special retirement laws referenced above, the employee is treated as a special member if the employing agency:
    • is covered (or later becomes covered) by the Constitution or a separate law providing an agency-administered retirement, separation, disability, or survivorship benefits package; and
    • is recognized by DBM through certification or declaration as having a separate retirement scheme with appropriated funds from DBM, such that the agency is not required to remit regular monthly GSIS contributions for retirement benefits under RA 8291.
  • A former regular member becomes a special member on the date of:
    • the effectivity of the law providing a separate pension/retirement benefit for the agency’s employees;
    • transfer to an agency with a separate pension/retirement package; or
    • appointment to a position entitled to a separate pension/retirement package under the Constitution or by a special law/Charter.

Premiums and life insurance plan rules

  • The PPG requires the membership service profile (MSP) to reflect special membership tagging by:
    • Credit tag: JCom;
    • Employee Position: the corresponding position title; and
    • Insurance Prefix: SM.
  • Special members’ premiums remitted by the agency cover life insurance coverage only, specifically three percent (3%) of BMS for the personal share and three percent (3%) of BMS for the government share.
  • The PPG sets the life endowment policy (LEP) endowment amount based on age at the time of effectivity:
    • Below 30: Endowment at 45
    • 30 to below 40: Endowment at 55
    • 40 to below 65: Endowment at 65
    • 65 and above: Endowment at 70
  • Special members are entitled to life insurance benefits and may avail of policy and consolidated loans.
  • GSIS must return excess retirement premium amounts:
    • to the agency for excess retirement premium (personal share) deducted from the special member’s salary during special membership coverage; and
    • to DBM for excess retirement premium (government share) for the same period.

Loan privileges for special members

  • Special members may avail ConsoLoan only after the relevant agency/ies executes a special agreement with GSIS.
  • ConsoLoan loanable amount is up to ten (10) months of computed monthly salary, where the salary basis is the amount derived from posted life insurance premium payments.
  • Special members may choose a lower ConsoLoan amount as long as loan proceeds cover the aggregate balance for existing loan accounts, including applicable fees charged.
  • Failure to indicate a preferred loan amount means the member applies for the maximum amount qualified to receive.
  • Monthly amortization for ConsoLoan is implemented through payroll deduction and shall not be stopped until the loan is fully paid.
  • Housing loan arrearages are excluded from further deduction from ConsoLoan or loan renewals.

Policy loans and pre-termination

  • Special members may avail policy loans secured by their compulsory life insurance policy issued after termination of regular membership and after optional policies, subject to existing Policy Loan terms and conditions.
  • If the special member was a former regular member and availed loans during regular membership, all loan balances are deducted from cash surrender value (CSV) / termination value (TV) or maturity value, whichever comes first.
  • If there is a negative balance or deficiency, the collection guidelines for due and demandable loan accounts under Section IV.C(4) apply.
  • Loans of special members may be pre-terminated (except housing loans) by paying the outstanding balance before the end of the loan term.
  • A loan agreement is also deemed pre-terminated upon death, resignation, permanent disability, retirement, or separation from service, with the outstanding principal (including unpaid interest immediately prior to occurrence) becoming due and demandable for collection by GSIS.

Housing loan settlement and due-and-demandable collection

  • Special members with existing housing loans that are not yet due and demandable or are within the payment term must continue monthly amortization through payroll deduction or post-dated checks (PDCs).
  • Housing loan accounts already in default or due and demandable must be settled through a separate collection mechanism.
  • Special members are not covered by the policy on Choice of Loan Amortization Schedule for Pensioners (CLASP).
  • For due and demandable accounts, the operating unit must initiate collection actions including automatic deduction from:
    • proceeds from future loan availments;
    • future benefits payable by GSIS (retirement, separation, disability, funeral benefits);
    • benefits payable by the agency;
    • redemption insurance on the loan where death occurs and redemption insurance is in force; and
    • other administrative or civil courses of action for collection of the outstanding balance.

Loan cancellation, default, and UMID eCard recovery

  • After loan approval and crediting of proceeds in the UMID eCard Account, the borrower cannot cancel the loan and must pre-terminate it only without any right for reimbursement of applicable interest, service fee, or redemption insurance premium.
  • An account is in default if there are more than six (6) months unpaid monthly amortization.
  • In default, the account is handled under existing policies and procedures for in-default accounts.
  • GSIS has the right to recover any amount credited in the UMID eCard account due to fraud, misrepresentation, or error in any GSIS transaction.

Claims and benefits processing for reclassified members

  • Reclassification from regular to special does not automatically entitle a member to separation benefits under Section 11 of RA 8291 or retirement benefits under Sections 13 and 13-A of RA 8291 until and unless there is actual separation from government service.
  • GSIS processes and pays applicable special member benefits based on premiums paid during the period when the member was a regular member.
  • GSIS determines eligibility by considering only the period of government service during the member’s regular membership.
  • A special member who met retirement requirements during regular membership (under RA 8291, PD 1146, RA 660, or RA 1616) is entitled to those retirement benefits upon actual separation.
  • A retiree receiving pension or gratuity continues receiving it even if re-employed with the government as a special member.
  • A special member who did not meet requirements for retirement under Section 13-A of RA 8291 but has at least 3 years of service during regular membership or is not yet 60 years of age is entitled to separation benefits, computed as follows:
    • If YOS < 15 years: cash benefit equal to PPP × AMC (AMC based on the last three (3) years immediately preceding cessation of regular membership), payable at age 60 under Section 11(a) of RA 8291.
    • If YOS ≥ 15 years and not yet 60 years of age: cash payment benefit equal to 18 × BMP payable immediately, plus an old-age pension benefit at age 60 under Section 11(b) of RA 8291.
  • Processing and payment of separation benefits require filing a claim application.
  • All outstanding loans are deducted from retirement or separation benefit proceeds.
  • If the retirement/separation benefit is insufficient to cover outstanding obligations, GSIS must inform DBM so the balance is deducted from benefits payable and remitted to GSIS.
  • A special member is entitled to funeral benefits if death occurs while in service.
  • A special member’s primary beneficiaries are entitled to survivorship benefits if the special member:
    • is already receiving pension;
    • has claimed GSIS retirement benefits; or
    • is still in active service but is entitled to GSIS retirement benefits.

Life insurance, disability benefits, and claim conditions

  • A special member with a life insurance policy in force at the date of termination of regular membership is entitled to maturity benefits or CSV benefits, whichever applies.
  • Processing and payment of life insurance benefits require filing a claim application.
  • Loan balances and pension overpayments, if any, are deducted from claim proceeds.
  • A special member who sustained disability prior to the effectivity of special membership is entitled to disability benefits under RA 8291, subject to GSIS disability-claims rules and regulations.
  • The PPG makes retirement/separation benefits contingent on actual separation from government service, while life insurance benefits follow the claim application process.

Other entitlements, premium remittance correction, and limitations

  • Special members with less than three (3) years of government service during regular membership receive no GSIS benefit except life insurance.
  • The life insurance policy must be in force for at least one (1) year for those benefits.
  • Retirement premiums paid are not refunded.
  • Claims for benefits, except life and retirement, prescribe after four (4) years from the date of contingency.
  • For separation benefit claims under Section 11(a) and 11(b) of RA 8291, the reckoning date for the four (4) year prescriptive period is:
    • actual date of separation; and
    • for death, the date of death of the member.
  • Existing policies and guidelines on filing separation benefit claims apply.
  • Special members may continue paying premiums for optional life insurance plans bought during regular membership if those plans were not fully paid as of cessation of regular membership.

Reclassifications involving premium remittances

  • Government employees not covered by special-member coverage under Section IV.A but who remit only the required life insurance premiums for special members must be reclassified as regular members.
  • Those employers and agencies must remit the corresponding premiums for regular membership, including:
    • the correct monthly contributions; and
    • any difference in required premiums due to regular membership,
      subject to existing GSIS policies and guidelines, plus interests on the unremitted required contributions as mandated by law.
  • The required premium allocation (by percentage of monthly compensable pay) is:
    • Member: 9.0% payable, composed of 2% for life insurance benefits and 7% for retirement and other social security benefits.
    • Agency: 12.0% payable, composed of 2% for life insurance benefits and 10% for retirement and other social security benefits.
  • Compulsory remittance applies to all employers.

Implementation, information dissemination, and operations updates

  • The Corporate Communications Office (CCO) is responsible for information dissemination of the PPG.
  • The ITSG provides the necessary computer services support and automation enhancements to efficiently implement the PPG.
  • Functional Groups concerned must ensure necessary changes in procedures are reflected in the pertinent sections of the Manual of Operations.
  • The PPG’s effectiveness is tied to Board approval.

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