National Insurance OfficeNational Insurance Office

by Mr. Kevin Harris and by Mr. Kevin Harris and

Ms. Shelley BladesMs. Shelley Blades

““National Insurance…More than a National Insurance…More than a Contribution. It’s your lifeline.”Contribution. It’s your lifeline.”

UNDERSTANDING UNDERSTANDING NIS BENEFITSNIS BENEFITS

Establishment Establishment

National Insurance was established in 1967 for National Insurance was established in 1967 for the purpose of providing benefits as may be the purpose of providing benefits as may be specified in the NISS Act ; to substitute for the specified in the NISS Act ; to substitute for the Workmen’s Compensation Act, 1963, a system Workmen’s Compensation Act, 1963, a system of insurance against personal injury caused by of insurance against personal injury caused by accident arising out of and in the course of a accident arising out of and in the course of a person’s employment and against prescribed person’s employment and against prescribed diseases and injuries due to the nature of a diseases and injuries due to the nature of a person’s employment; to establish for the person’s employment; to establish for the administration thereof a National Insurance administration thereof a National Insurance Board and a National Insurance Fund ; and Board and a National Insurance Fund ; and for purposes connected with the matters for purposes connected with the matters aforesaid.aforesaid.

ObjectivesObjectives

ContributorsContributors

Benefits Payable -ShortBenefits Payable -Short

Pension ReformPension Reform

Benefits Payable-LongBenefits Payable-Long

CONTRIBUTORSCONTRIBUTORS

WHO BENEFITS:WHO BENEFITS:

Persons between the age of 16 and Persons between the age of 16 and 66(pensionable age), is self-employed, or 66(pensionable age), is self-employed, or employed under a contract of service, is employed under a contract of service, is covered under the Act.covered under the Act.

Insurable EarningsInsurable Earnings

$91 to $4,270 per month or$91 to $4,270 per month or

$21 to $985 per week.$21 to $985 per week.

SHORT TERM BENEFITS SHORT TERM BENEFITS PAYABLEPAYABLE

SicknessSickness

Maternity Benefit/GrantMaternity Benefit/Grant

UnemploymentUnemployment

Employment Injury-Employment Injury- (Medical and (Medical and Travel Expenses)Travel Expenses)

SHORT TERMSHORT TERM

To qualify for To qualify for Sickness BenefitSickness Benefit Have credited not less that 7 Have credited not less that 7

contributions in the relevant quarter.contributions in the relevant quarter. Have been engaged in employment Have been engaged in employment

immediately before becoming ill.immediately before becoming ill. How is the benefit computed?How is the benefit computed?The daily rate is 66 2/3 % of the insured person’s The daily rate is 66 2/3 % of the insured person’s

average insurable weekly earnings divided by 6average insurable weekly earnings divided by 6

SHORT TERMSHORT TERM

To qualify for To qualify for Maternity BenefitMaternity Benefit Have been insured for 26 contribution weeksHave been insured for 26 contribution weeks Have paid at least 16 contributions in the 2 Have paid at least 16 contributions in the 2

quarters but one before the contribution quarters but one before the contribution quarter in which the benefit could become quarter in which the benefit could become payable.payable.

Self-employed- not less that 39 contributions Self-employed- not less that 39 contributions paid or credited to her account.paid or credited to her account.

How is the benefit computed?How is the benefit computed?

The daily rate is 100% of the insured person’s The daily rate is 100% of the insured person’s average insurable weekly earnings divided by 6average insurable weekly earnings divided by 6

SHORT TERMSHORT TERM

To qualify for To qualify for Maternity GrantMaternity Grant Must not be an Insured personMust not be an Insured person Must be an insured person who does not Must be an insured person who does not

satisfy the contribution conditions for satisfy the contribution conditions for Maternity Benefit.Maternity Benefit.

The Spouse must have been an insured The Spouse must have been an insured person and have paid contributions for the person and have paid contributions for the relevant period.relevant period.

How is the benefit computed?How is the benefit computed?

The amount payable is $1, 125.00.The amount payable is $1, 125.00.

SHORT TERMSHORT TERM

To qualify for To qualify for Unemployment BenefitUnemployment Benefit Have been insured for 52 contribution weeksHave been insured for 52 contribution weeks Have paid at least 20 contributions in the 3 Have paid at least 20 contributions in the 3

quarters but one before the contribution quarters but one before the contribution quarter in which the benefit could become quarter in which the benefit could become payable.payable.

Paid for a maximum period of 26 weeks.Paid for a maximum period of 26 weeks.

How is the benefit computed?How is the benefit computed?

The daily rate is 60% of the insured person’s The daily rate is 60% of the insured person’s average insurable weekly earnings divided by 6average insurable weekly earnings divided by 6

SHORT TERMSHORT TERM

To qualify for To qualify for Injury BenefitInjury Benefit Must be incapable of work as a result of Must be incapable of work as a result of

an accident arising out of and in the an accident arising out of and in the course of insured employment,course of insured employment,

Must be incapable of work as a result of a Must be incapable of work as a result of a prescribed disease.prescribed disease.

How is the benefit computed?How is the benefit computed?

The daily rate is 90% of the insured The daily rate is 90% of the insured person’s average insurable weekly person’s average insurable weekly earnings divided by 6earnings divided by 6

PENSION REFORMPENSION REFORM

Increase in NIS contribution rates by 1% Increase in NIS contribution rates by 1% each year, for 4 years.each year, for 4 years.

Increase pensionable age by 6 months Increase pensionable age by 6 months every 4 years starting Jan 01, 2006 until every 4 years starting Jan 01, 2006 until age 67 is reached in 2018.age 67 is reached in 2018.

Introduction of flexible NIS Retirement Introduction of flexible NIS Retirement ages so that persons may retire on an NIS ages so that persons may retire on an NIS pension at any age from 60 to 70.pension at any age from 60 to 70.

((0.5% reduction/increase applies for early/late 0.5% reduction/increase applies for early/late retirement respectively)retirement respectively)

PENSION PENSION REFORMREFORM

Time LineTime Line Pensionable Pensionable AgeAge

Up to Dec 2005Up to Dec 2005 65 years65 yearsJan 2006 to Dec Jan 2006 to Dec 20092009

65 ½ 65 ½

Jan 2010 to Dec Jan 2010 to Dec 20132013

6666

Jan 2014 to Dec Jan 2014 to Dec 20172017

66 ½ 66 ½

From Jan 2018From Jan 2018 6767

YearYear AgeAge20032003 646420042004 6363

20052005 626220062006 616120072007 6060

Presently Old Age Contributory Pension may be claimed as early as age 60 or as late as 70, with a 0.5% per month reduction/increase for early/late retirement respectively.

Standard Pensionable Age Early Pension

Pension Formula: Pension Formula: 2 % Average Annual Insurable Earnings for 2 % Average Annual Insurable Earnings for first 20 yearsfirst 20 years

PlusPlus1.25% AAIE for years thereafter subject to 1.25% AAIE for years thereafter subject to

maximum of 60%maximum of 60%

As of Dec 31 2002As of Dec 31 2002 More than 10 years to retirement More than 10 years to retirement - no change- no changeBetween 10 years to 20 years Between 10 years to 20 years -50% old -50% old

basisbasis-50% new basis-50% new basis

More than 20 years More than 20 years -new basis-new basis

PENSION REFORM PENSION REFORM

LONG TERM BENEFITS LONG TERM BENEFITS PAYABLEPAYABLE

RECIPROCAL PENSIONSRECIPROCAL PENSIONS INVALIDITY PENSION / GRANTINVALIDITY PENSION / GRANT DISABLEMENT PENSION / GRANTDISABLEMENT PENSION / GRANT OLD AGE CONTRIBUTORY PENSION / GRANTOLD AGE CONTRIBUTORY PENSION / GRANT NON-CONTRIBUTORY OLD AGE PENSION NON-CONTRIBUTORY OLD AGE PENSION SURVIVORS’ PENSION / GRANTSURVIVORS’ PENSION / GRANT FUNERAL GRANTFUNERAL GRANT DEATH BENEFITDEATH BENEFIT

RECIPROCAL PENSIONSRECIPROCAL PENSIONS

If you do not qualify for a pension under If you do not qualify for a pension under the National Insurance regulations, the the National Insurance regulations, the periods of contributions in both periods of contributions in both countries are combined. Each country countries are combined. Each country then calculates the amount of pension it then calculates the amount of pension it would have paid if the total combined would have paid if the total combined contributions had been paid under its contributions had been paid under its own Scheme. own Scheme.

RECIPROCAL PENSIONSRECIPROCAL PENSIONSThere is a Social Agreement betweenThere is a Social Agreement between::

Barbados & United Kingdom, Canada, Quebec and some Barbados & United Kingdom, Canada, Quebec and some Caricom states.Caricom states.

There are:There are: Antigua and Barbuda , The Bahamas Antigua and Barbuda , The Bahamas Barbados, Belize Barbados, Belize Dominica, Grenada Dominica, Grenada Guyana ,Jamaica Guyana ,Jamaica Montserrat, St. Kitts and Nevis Montserrat, St. Kitts and Nevis Saint Lucia, St. Vincent and The Grenadines, Saint Lucia, St. Vincent and The Grenadines, and Trinidad and Tobago. and Trinidad and Tobago.

The Agreement is not in effect in Suriname The Agreement is not in effect in Suriname and Haiti.and Haiti.

CALCULATIONCALCULATION

The minimum pension is The minimum pension is $175.00 $175.00 per week. per week.

Requirement is at least Requirement is at least 500500 contributions in contributions in order to qualify for an OACP.order to qualify for an OACP.

If in Barbados you have only made If in Barbados you have only made 300300 contributions and in Trinidad and Tobago, contributions and in Trinidad and Tobago, where you made where you made 200200 contributions. contributions.

The portion of the pension to which you are The portion of the pension to which you are entitled in Barbados will therefore be entitled in Barbados will therefore be calculated based on your contribution to the calculated based on your contribution to the Barbados Scheme: Barbados Scheme: 300/500 x $175.00 = 300/500 x $175.00 = $105.00$105.00

INVALIDITY PENSIONINVALIDITY PENSION

For N.I.S purposes the term “invalid” means For N.I.S purposes the term “invalid” means a person incapable of work, as a result of a a person incapable of work, as a result of a specific disease or bodily or mental specific disease or bodily or mental disablement, which is likely to remain disablement, which is likely to remain permanent.permanent.

An insured person who is under pensionable An insured person who is under pensionable age is entitled to an invalidity pension as age is entitled to an invalidity pension as long as the invalidity continues.long as the invalidity continues.

INVALIDITY PENSIONINVALIDITY PENSIONTo qualify for an Invalidity Pension To qualify for an Invalidity Pension must have at least 150 contributions paid.must have at least 150 contributions paid.

The pension is 40% of avg. annual The pension is 40% of avg. annual insurable earnings over the best 3 years, insurable earnings over the best 3 years, plus 1% of total insurable earnings after plus 1% of total insurable earnings after 150 contributions.150 contributions.

To qualify for Invalidity GrantTo qualify for Invalidity Grant must have at least 50 contributions paid or must have at least 50 contributions paid or

credited . credited . This is paid as a lump sum. It is equal to This is paid as a lump sum. It is equal to

6 weeks avg. insurable weekly earnings 6 weeks avg. insurable weekly earnings for each 50 contributions paid.for each 50 contributions paid.

CALCULATIONCALCULATIONBest 3 years: Best 3 years: 2008 - 52 weeks - $28,8002008 - 52 weeks - $28,800

2009 – 52 weeks - $29,6002009 – 52 weeks - $29,600

2011 – 52 weeks - $30,4002011 – 52 weeks - $30,400

Total - $88,800Total - $88,800

Average annual insurable earning Average annual insurable earning $88, 800/3 - $29,600 $88, 800/3 - $29,600

40% of the Avg. Ins. Earnings 40% of the Avg. Ins. Earnings 0.4*$29,600 - $11,800 0.4*$29,600 - $11,800

Total earnings after 150 contributions $145,500*0.01 - $1, 455Total earnings after 150 contributions $145,500*0.01 - $1, 455

Total weekly pension is $11800+$1,455.00/52 weeks - $255.67Total weekly pension is $11800+$1,455.00/52 weeks - $255.67

This amount should not exceed the maximum, which is 60% of the This amount should not exceed the maximum, which is 60% of the average insurable earnings.) e.g. 60% of Avg. Ins. Earningsaverage insurable earnings.) e.g. 60% of Avg. Ins. Earnings

0.60* $29,600 0.60* $29,600 - $17,760- $17,760

Weekly pensionWeekly pension $17, 760/52 - $341.54 $17, 760/52 - $341.54

Since $255.67 is less than $341.54 the weekly rate will be $255.67. Since $255.67 is less than $341.54 the weekly rate will be $255.67.

DISABLEMENT PENSIONDISABLEMENT PENSION An insured person is entitled to a disablement An insured person is entitled to a disablement

benefit if he suffers from the loss of physical or benefit if he suffers from the loss of physical or mental faculty, as a result of an employment mental faculty, as a result of an employment related accident . related accident .

Conditions-:Conditions-: The disablement must be assessed at, at least 1 The disablement must be assessed at, at least 1

%. %. 1 – 29 % assessment is paid as a grant.1 – 29 % assessment is paid as a grant. More than 30% assessment is paid as a pensionMore than 30% assessment is paid as a pension..

Benefit is payable from the 3Benefit is payable from the 3rdrd day following 52 day following 52 weeks after the date of accident.weeks after the date of accident.

The assessment must be conducted by a The assessment must be conducted by a certified medical practitionercertified medical practitioner

DISABLEMENT PENSIONDISABLEMENT PENSION

The benefit is calculated on the Injury The benefit is calculated on the Injury Benefit rateBenefit rate

The benefit is duplicated with all other The benefit is duplicated with all other benefits except Invalidity benefitbenefits except Invalidity benefit

The pension may be payable for life (if The pension may be payable for life (if assessment is final and greater than 30%)assessment is final and greater than 30%)

The claimant may continue to work while The claimant may continue to work while in receipt of a disablement benefit.in receipt of a disablement benefit.

OLD AGE CONTRIBUTORY OLD AGE CONTRIBUTORY PENSIONPENSION

This pension is based on the insured This pension is based on the insured earnings of the individual, on which earnings of the individual, on which contributions were made to the NIS.contributions were made to the NIS.

Early pensionable age ( 60 to 65 years)Early pensionable age ( 60 to 65 years) Pensionable age 66 yearsPensionable age 66 years Late pensionable age (67 to 70 years)Late pensionable age (67 to 70 years)

CALCULATIONCALCULATION An insured person contributed to NIS for 1,850 weeks. His An insured person contributed to NIS for 1,850 weeks. His

best earnings were in the last 5 years, the annual average best earnings were in the last 5 years, the annual average of which was of which was $30,000$30,000. His aggregate earnings after the . His aggregate earnings after the first 500 were first 500 were $550,800$550,800. To compute their pension:. To compute their pension:

Basic pension:Basic pension: $30,000 x 40% $30,000 x 40% ==

$12,000$12,000

Supplementary Supplementary $550,800 x 1% $550,800 x 1% ==

$5,508$5,508

Annual pensionAnnual pension $12,000 + $12,000 + $5,508$5,508

$17,508$17,508

Weekly pensionWeekly pension $17,508/52$17,508/52 $336.69$336.69

OLD AGE CONTRIBUTORY OLD AGE CONTRIBUTORY PENSIONPENSION

There are three bases for calculating There are three bases for calculating NIS pension which is dependent on NIS pension which is dependent on the year you reached retirement age.the year you reached retirement age.

Persons 56 years or over at December 31, Persons 56 years or over at December 31, 2002 may use the old basis of calculation.2002 may use the old basis of calculation.

Person under 47 years in December 31, 2002 Person under 47 years in December 31, 2002 will use the new basis.will use the new basis.

All other pensions will be calculated using the All other pensions will be calculated using the 50% new plus 50% old basis also known as the 50% new plus 50% old basis also known as the 50/50 basis.50/50 basis.

OLD AGE OLD AGE CONTRIBUTORY CONTRIBUTORY

PENSIONPENSION(56 on December 31, (56 on December 31,

2002)2002)OLD BASISOLD BASIS40% of 40% of Average Annual Insurable Earnings Average Annual Insurable Earnings

(AAIE)(AAIE) PlusPlus1% of 1% of Total Insurable EarningsTotal Insurable Earnings after the first after the first

500500

150 contributions paid and 500 contributions 150 contributions paid and 500 contributions paid or credited.paid or credited. Subject to a maximum pension of 60% of AAIE and a Subject to a maximum pension of 60% of AAIE and a

minimum of $175 per week.minimum of $175 per week. The AAIE is based on best 5 calendar yearsThe AAIE is based on best 5 calendar years

OLD AGE CONTRIBUTORY OLD AGE CONTRIBUTORY PENSIONPENSION

NEW BASISNEW BASIS2% for ever 50 contributions per year 2% for ever 50 contributions per year

of of Average Annual Insurable Average Annual Insurable Earnings (AAIE)Earnings (AAIE) for the first 1000 for the first 1000 yearsyears

PlusPlus

1 1/4% for every 50 contributions of the 1 1/4% for every 50 contributions of the remaining yearsremaining years

Persons <47 on 31 Dec Persons <47 on 31 Dec 20022002

Annual average over the best five yearsAnnual average over the best five years 2% for each year for first 1000 years and 2% for each year for first 1000 years and

1111//44% for all subsequent years% for all subsequent years 1850 weeks = 37 years1850 weeks = 37 years 20 x 2% x $37,416 = $14,966.4020 x 2% x $37,416 = $14,966.40 17 x 117 x 111//44% x $37,416 = $7,950.90% x $37,416 = $7,950.90 $14,966.40+$7,950.90=$22,917.30$14,966.40+$7,950.90=$22,917.30 Annual pension capped at 60% = Annual pension capped at 60% =

$22,449.60$22,449.60

OLD AGE CONTRIBUTORY OLD AGE CONTRIBUTORY PENSIONPENSION

50/50 BASIS50/50 BASIS

½ of the old basis plus½ of the old basis plus

½ of the new basis½ of the new basis

½ of $336.69 + ½ of $336.69 = $336.70½ of $336.69 + ½ of $336.69 = $336.70

OLD AGE CONTRIBUTORY OLD AGE CONTRIBUTORY GRANTGRANT

This is a lump sum payment to an This is a lump sum payment to an individual who falls short of the individual who falls short of the contribution requirements for an OACP.contribution requirements for an OACP.

To qualify the individual must have To qualify the individual must have attained pensionable age and must have at attained pensionable age and must have at least 50 contributions paid and less than least 50 contributions paid and less than 500 (paid and credited).500 (paid and credited).

NON-CONTRIBUTORY NON-CONTRIBUTORY OLD AGE PENSIONOLD AGE PENSION

Eligibility:Eligibility: Must be a citizen or permanent resident of Must be a citizen or permanent resident of

Barbados.Barbados. The claimant may be blind or deaf-mute 18 The claimant may be blind or deaf-mute 18

years or olderyears or older Not paid to persons in receipt of a Gov’t or Not paid to persons in receipt of a Gov’t or

Social Security Pension that is higherSocial Security Pension that is higher The pension payable is The pension payable is $142.00 $142.00 per weekper week

SURVIVORS’ PENSIONSURVIVORS’ PENSION

This pension is paid to the surviving This pension is paid to the surviving spouse and/or children of the deceased spouse and/or children of the deceased who was in receipt of or would have been who was in receipt of or would have been entitled to an Invalidity Pension or Old Age entitled to an Invalidity Pension or Old Age Contributory Pension.Contributory Pension.

The deceased must have had at least 150 The deceased must have had at least 150 contributions paid.contributions paid.

SURVIVORS’ PENSIONSURVIVORS’ PENSIONSpouse’s BenefitSpouse’s Benefit

Spouse 50 years or overSpouse 50 years or over and married for at least 3 and married for at least 3 years is entitled to 1/2 of Pension payable for life years is entitled to 1/2 of Pension payable for life but ceases upon remarriage or co-habitationbut ceases upon remarriage or co-habitation

Spouse 45 to 49Spouse 45 to 49 and married for at least 3 years is and married for at least 3 years is entitled to 1/3 of pension payable for life but entitled to 1/3 of pension payable for life but ceases upon remarriage or co-habitationceases upon remarriage or co-habitation Where the spouse qualify for a pension in their own Where the spouse qualify for a pension in their own

right that is higher than the survivors’ pension, the right that is higher than the survivors’ pension, the other pension is paid.other pension is paid.

Spouse under 45Spouse under 45 and married for at least 3 years is and married for at least 3 years is entitled to ½ of pension payable for one year only.entitled to ½ of pension payable for one year only.In any event if married for less than 3 years the pension In any event if married for less than 3 years the pension

payable ispayable is½ of pension for 1 year only.½ of pension for 1 year only.

SURVIVORS’ PENSIONSURVIVORS’ PENSIONChildren’s BenefitChildren’s Benefit

Eligibility:Each child is entitled to 1/6 of the benefit up to age 16 or age 25 if in full time education.An Orphan is entitled to 1/3 of the benefitAn Invalid child is entitled to 1/3 of the benefit for life.

SURVIVORS’ SURVIVORS’ GRANTGRANT

The deceased must have had at least 50 The deceased must have had at least 50 contributions paid but less than 150 contributions paid but less than 150 contributionscontributions The grant is apportioned in the same The grant is apportioned in the same

way as the survivors pensionway as the survivors pension

This benefit is a lump sum payment made This benefit is a lump sum payment made to the surviving spouse and/or children of to the surviving spouse and/or children of the deceased who would have been the deceased who would have been entitled to an Invalidity grant or Old Age entitled to an Invalidity grant or Old Age Contributory grant.Contributory grant.

DEATH BENEFITDEATH BENEFITThis is paid in the case of a death, due to employment This is paid in the case of a death, due to employment

injuryinjury

The benefit is paid to the dependants of the deceasedThe benefit is paid to the dependants of the deceased

spouse – wholly or mainly maintained by deceased at spouse – wholly or mainly maintained by deceased at the time of death is entitled to ½ the benefit the time of death is entitled to ½ the benefit for for life life but ceases upon remarriage or co-habitation.but ceases upon remarriage or co-habitation.

In event of remarriage or co-habitation a gratuity of 1 In event of remarriage or co-habitation a gratuity of 1 years’ pension is payableyears’ pension is payable

Each child is entitled to 1/6 of the benefit up to age 16 Each child is entitled to 1/6 of the benefit up to age 16 or age 25, if in full time education.or age 25, if in full time education.

An orphan is entitled to 1/3 of the benefitAn orphan is entitled to 1/3 of the benefit An invalid child is entitled to 1/3 of the benefit for life.An invalid child is entitled to 1/3 of the benefit for life.

FUNERAL GRANTFUNERAL GRANT A Funeral Grant is payable in respect of A Funeral Grant is payable in respect of

the death of an insured person who at the the death of an insured person who at the time of death was in receipt of (or had time of death was in receipt of (or had entitlement to) Sickness, Maternity, entitlement to) Sickness, Maternity, Unemployment, Invalidity or Old Age Unemployment, Invalidity or Old Age Contributory benefits. Contributory benefits.

Payable to the person who has met ,or is Payable to the person who has met ,or is likely to meet the cost of the funerallikely to meet the cost of the funeralNote: an undrawn Benefit is also paid after the Note: an undrawn Benefit is also paid after the death of the insured person to the spouse or death of the insured person to the spouse or executor of the affairs of the person. executor of the affairs of the person.

FUNERAL GRANT FUNERAL GRANT

A Funeral Grant is also payable in respect A Funeral Grant is also payable in respect of the death of the spouse of an insured of the death of the spouse of an insured person in respect of whom a grant would person in respect of whom a grant would have been payable whether or not the have been payable whether or not the spouse had predeceased the insured spouse had predeceased the insured person.person.

Lump Sum - $1,950.00Lump Sum - $1,950.00

NATIONAL NATIONAL INSURANCEINSURANCE

THANK YOUTHANK YOU

ANY QUESTIONS???ANY QUESTIONS???

Website – www.nis.gov.bbWebsite – www.nis.gov.bb