1. (a) The standard annuity benefit is payable throughout life for service retirees or for the duration of the disability for disability retirees with at least 10 years of service, with payments ceasing at the death of the retired member. If the retired member did not receive annuity payments equal to his accumulated contributions, there shall be paid to his beneficiary an amount equal to the retired member's accumulated contributions less the total amount of retirement benefits paid to the retired member.

2. (b) An option which permits the retiree to reduce his own annuity with monthly benefits continuing to a beneficiary after his death may be selected in lieu of the standard annuity. The options are:

   1. (1) a reduced allowance payable throughout life with the provision that upon the death of the retired member, the reduced allowance shall be continued throughout the life of, and paid to, the person named before retirement. Upon the death of a retired member's beneficiary who was receiving an Option 1 annuity, if the total payment of benefits to the retired member and his beneficiary under this option was less than the accumulated contributions of the retired member, then the estate or heirs of the beneficiary shall be refunded an amount equal to the retired member's accumulated contributions less the total amount of Option 1 benefits which has been paid to both annuitants;
   2. (2) a reduced allowance payment throughout life with the provision that upon the death of the retired member, one-half of the reduced allowance shall be continued throughout the life of, and paid to, the person named before retirement. Upon the death of a retired member's beneficiary who was receiving an Option 2 annuity, if the total payment of benefits to the retired member and his beneficiary under this option was less than the accumulated contributions of the retired member, then the estate or heirs of the beneficiary shall be refunded an amount equal to the retired member's accumulated contributions less the total amount of Option 2 benefits which had been paid to both annuitants;
   3. (3) a reduced allowance payable for guaranteed period of five years and as long thereafter as the retired member shall live;
   4. (4) a reduced allowance payable for guaranteed period of 10 years and as long thereafter as the retired member shall live.

3. (c) For Option 1 and for Option 2, if the beneficiary predeceases the retiree, the retiree's annuity will be increased (pop-up) to the standard service annuity that the retiree would otherwise be entitled to receive if the retiree had not selected Option 1 or 2 but had selected the standard annuity. The standard annuity shall be adjusted by the early age reduction factor in effect at the time of retirement if the member retired under the early age service retirement provisions. The standard annuity shall also be adjusted for any post retirement increases in retirement benefits authorized by law for the standard annuity after the date of retirement.

   1. (1) The increased annuity will begin with the first monthly-payment which should have been made to the retiree following the month in which the beneficiary's death occurs.
   2. (2) The retiree shall promptly notify the Teachers Retirement System of Texas (TRS) of the death of the beneficiary and submit a certified copy of the beneficiary's death certificate or other adequate proof of death to TRS. In the event that the retiree fails to notify TRS promptly of the death of the beneficiary, TRS shall continue to pay the reduced annuity to the retiree until properly notified of the beneficiary's death. Any payment for past months in which the retiree could have been receiving the standard annuity shall be made in a lump sum with the first monthly payment after the month in which notice is received. No interest shall be paid with any lump sum payment.

4. (d) Subsection (c) of this section applies:

   1. (1) to members who retired on service retirement after August 31, 1989, or disability retirement after August 31, 1992; and
   2. (2) to members who retired on service retirement under Option 1 or 2 after April 30, 1989, and who elect in writing no later than September 30, 1989, to receive an annuity reduced as necessary to implement the pop-up feature in accordance with actuarial tables effective September 1, 1989.

Source Note:The provisions of this §29.8 adopted to be effective January 1, 1976; amended to be effective September 29, 1989, 14 TexReg 4784; amended to be effective September 1, 1992, 17 TexReg 5120.