A member who has reached age 65 and has at least 10 years of creditable service is eligible for normal retirement and, as such, is entitled to 100% of the pension benefit component. This annual pension benefit is equal to 1.1% times the average annual compensation times the number of years of creditable service. The average annual compensation in this calculation uses the highest 20 calendar quarters of salary in a covered position. All 20 calendar quarters do not need to be continuous, but they must be in groups of four (4) consecutive calendar quarters. The same calendar quarter may not be included in two (2) different groups. For PERF members who serve as an elected official, the highest one (1) year (total of four (4) consecutive quarters) of annual compensation is used. Member contributions paid by the employer on behalf of the member and severance pay up to $2,000 are included as part of the member's annual compensation.
A member who has reached age 60 and has at least 15 years of creditable service is eligible for normal retirement and, as such, is entitled to 100% of the pension benefit. A member who is at least 55 years old and whose age plus number of years of creditable service is at least 85 is entitled to 100% of the benefits as described above.
A member who has reached at least age 50 and has at least 15 years of creditable service is eligible for early retirement with a reduced pension. A member retiring early receives a percentage of the normal annual pension benefit. The percentage of the pension benefit at retirement remains the same for the member's lifetime. For age 59, the early retirement percentage of the normal annual pension benefit is 89%. This amount is reduced five (5) percentage points per year (e.g., age 58 is 84%) to age 50 being 44%.
The monthly pension benefits for members in pay status may be increased periodically as cost of living adjustments (COLA). Such increases are not guaranteed by statute and have historically been provided on an "ad hoc" basis and can only be granted by the Indiana General Assembly.
Disability and Survivor Benefits
Death and survivor benefits are provided in accordance with Indiana statutes and INPRS plan provisions. If a member dies while receiving a retirement benefit, any continuing payments to a beneficiary/survivor are made in accordance with the payment option selected by the member at retirement (e.g., Five-Year Certain and Life or a joint-and-survivor option). If a member dies prior to retirement (and did not apply for retirement), a surviving spouse (married to the member for at least two years) or eligible dependent child(ren) may be entitled to a survivor pension benefit; for deaths occurring after June 30, 2018, eligibility generally requires at least ten (10) years of creditable service. Survivor pension benefits for eligible spouses/dependents are generally determined as the actuarial equivalent of the benefit that would have been payable under the applicable joint-and-survivor option had the member retired at age 50 or the date of death, whichever is later, subject to statutory limitations.
The PERF Hybrid Plan also provides disability and survivor benefits. A member who has at least five (5) years of creditable service and becomes disabled while in active service, on FMLA leave, receiving workers' compensation benefits or receiving employer-provided disability insurance benefits may retire for the duration of the disability, if the member has qualified for social security disability benefits and has furnished proof of the qualification. The disability benefit is calculated the same as that for a normal retirement without reduction for early retirement. The minimum benefit is $185 per month or the actuarial equivalent.