Amended Guidelines on Pag-IBIG Fund Membership Termination

May 12, 2017

HDMF CIRCULAR NO. 380-17

 

Pursuant to the approval of the Senior Management Committee in its Meeting held last July 11, 2016, the following Amended Guidelines on Pag-IBIG Fund Membership Termination are hereby issued:

A. OBJECTIVE

These guidelines aim to:

1. Provide general guidelines to operationalize Sections 9, 10 & 11, Rule V of Implementing Rules and Regulations (IRR) of Republic Act (RA) 9679 or the Home Development Mutual Fund (HDMF) Law of 2009;

2. Define the grounds for termination of membership with the Fund; and

3. Prescribe rules relative to the application, processing, approval, and fund releasing for provident benefit claims of Fund members who qualify for membership termination.

B. COVERAGE

These guidelines shall cover all Pag-IBIG members who are entitled to withdraw their Total Accumulated Value (TAV) anytime upon the occurrence of any of the grounds for termination of Fund membership as provided under RA 9679 or the HDMF Law of 2009, and its IRR.

C. EXCLUSION

The following shall not constitute as grounds for termination of membership:

1. Resignation, lay-off, suspension from employment, or unemployment.

2. The optional withdrawal of savings does not terminate Pag-IBIG Fund membership. A member who availed of this program shall continue to become Fund member until such time that he becomes eligible to terminate his Fund membership under the grounds for membership termination.

D. GROUNDS FOR MEMBERSHIP TERMINATION

Membership with the Fund shall be terminated anytime upon occurrence of any of the following grounds, provided the necessary application together with the supporting documentary requirements have been filed, processed, and approved:

1. Membership Maturity

1.1. Eligibility for membership maturity shall be based on twenty (20) years of membership with the Fund, reckoned from the first day of the month to which the member's initial contribution to the Fund applies; provided, that the member shall have contributed a total of two hundred forty (240) membership savings at the time of maturity. Member's savings shall comprise of employee and employer share, if applicable.

1.2. The base date of the initial contribution shall refer to the initial period covered that is recorded in the database.

 However, if the employer pays unremitted collections due to enforcement, the same shall be applied retroactively upon the employee's presentation of proof that said contributions were previously collected/deducted from him/her. Such shall also apply to said employer's previous employees from whom deductions were made but were not remitted. In these cases, the reckoning of membership shall be on the date that the member should have been coverable by the Fund.

2. Retirement

 A member shall be compulsorily retired with the Fund upon reaching the age of sixty-five (65).

2.1. A member may opt to retire earlier under the Fund anytime upon occurrence of any of the following events, provided the member is not a housing loan borrower:

2.1.1. Actual retirement from SSS and/or GSIS:

a. SSS Retirement

 

Applicable Law	Retirement
RA 8282	• Sixty (60) years old and has at least one hundred twenty (120) SSS monthly contributions • Sixty-five (65) years old and has at least one hundred twenty (120) SSS monthly contributions For underground mineworkers: • Fifty-five (55) years old with at least five (5) years in service as underground mine worker and has at least one hundred twenty (120) SSS monthly contributions

 

b. GSIS Retirement

 

 

2.1.2. Actual retirement from government service by provision of law, as in the following:

a. Members of the Armed Forces of the Philippines (PD 1650)

• Optional retirement — at least twenty (20) years of active service;

• Compulsory retirement — at least thirty (30) years of active service or at least fifty-six (56) years old with at least twenty (20) years of active service.

b. Members of the Philippine National Police (RA 8551), Bureau of Jail Management and Penology, and Bureau of Fire Protection (RA 9263)

• Optional retirement — at least fifty (50) years old and twenty (20) years of active service;

• Compulsory retirement — at least fifty-six (56) years old.

c. Members of the Philippine Coast Guard and Uniformed Service Attaches to the Department of Transportation and Communications (RA 9993)

• Optional retirement — at least twenty (20) years of active service;

• Compulsory retirement — at least thirty (30) years of active service or at least fifty-six (56) years old with at least twenty (20) years of active service.

d. Members of the Judiciary (RA 9946)

• Optional retirement — at least sixty (60) years old with at least fifteen (15) years of active service;

• Compulsory retirement — seventy (70) years old.

 Retirement must be evidenced by corresponding proofs of retirement of the member issued by his/her employer that he was able to meet the minimum service requirement and/or age requirement as prescribed under their respective charter.

2.1.3. Retirement under a private employer's provident/retirement plan, provided that the member is at least forty-five (45) years of age at the time of retirement.

2.1.4. Reaching the age of sixty (60).

3. Permanent Total Disability or Insanity

 A member shall terminate his membership with the Fund in case of permanent total disability (PTD). PTD refers to the loss or impairment of a physical or mental function resulting from injury or sickness, which incapacitates said member to perform any work or engage in any business or occupation.

 The following disabilities shall be deemed total and permanent:

3.1. Temporary total disability lasting continuously for more than one hundred twenty (120) days;

3.2. Complete loss of sight of both eyes;

3.3. Loss of two limbs at/or over the ankle or wrist;

3.4. Permanent complete paralysis of two (2) limbs;

3.5. Brain injury resulting in incurable insanity; and

3.6. Such other cases which are adjudged to be total and permanent disability by a duly licensed physician and approved by the Fund's Board of Trustees (Board).

4. Termination from Service by Reason of Health

 A member can no longer render service to an employer due to severe health conditions, as certified by his doctor. Severe health conditions constitute an illness, injury, impairment or, physical or mental condition that involves in-patient or out-patient care or a continuing treatment by a health care provider.

5. Permanent Departure from the Country

 A member has been permitted by his host country to remain there indefinitely or has permanently left the Philippines to reside in another country.

6. Death

 Death of a member as evidenced by a Death Certificate issued by the Philippine Statistics Authority (PSA).

7. Any other reasons as may be approved for by the Board.

E. EFFECTS OF MEMBERSHIP TERMINATION

If the member applying for membership termination has outstanding obligation in any of the Fund's programs, the following policies shall apply:

1. For Short Term Loans, any outstanding, including interest and penalties, shall be deducted from the borrower's TAV and/or any amount due him that are in the possession of the Fund.

1.1. For membership maturity, retirement, and permanent departure from the country, the cut-off date for the computation of loan balances and offsetting of loan obligation, if applicable, shall be the date of approval of the application for provident benefit claim.

1.2. For termination due to PTD, termination from service due to health reasons or borrower's death, the cut-off date for the computation of loan balances and offsetting of loan obligation, if applicable, shall be at point of occurrence of the said grounds.

 If the occurrence is prior to date of TAV offsetting due to default, the loan balances, interests and penalties shall be re-computed up to the occurrence of the applicable grounds.

1.3. Any remaining TAV after offsetting in cases mentioned in subsection 1.2 above, shall earn dividends up to date of filing of provident benefit claim.

2. For Housing Loans, regardless of its status and Circular by which it was taken out, the member shall be allowed to withdraw his TAV but shall continue to pay the amortization of the loan until it is fully paid.

3. The cut-off date for the computation of TAV shall be the date of receipt of the application for provident benefits.

F. PAYMENT OF BENEFITS

1. Return of Total Accumulated Value

1.1. The TAV to be returned to the member or his legal heirs, less of any and all pending obligations with the Fund, shall consist of the following:

a. The member's remitted accumulated savings;

b. The employer's counterpart savings, if applicable; and

c. Dividend earnings credited to the member's account as declared by the Board.

1.2. For members with outstanding obligations with the Fund, at the time of termination of membership, the said obligation shall be deducted from his TAV prior to the release of the provident claim. Application of member's TAV shall be according to the following order of priority:

1.2.1. Short-Term Loan

a. Penalty, if applicable

b. Interest, and

c. Principal

1.2.2. Pag-IBIG Loyalty Card Fee

1.3. Release of member's TAV shall be based on actual savings remitted by the employee and employer (if applicable). In the case of member-claimants whose employer counterpart savings have not been remitted to the Fund, a partial release of their TAV shall be made based on actual amounts credited to their accounts. In the same manner, the computation of annual dividends shall be based on actual remittances made.

 Any amount that the Fund may collect (i.e., total unremitted monthly savings and computed deprived dividends) from the employer due to enforcement shall be subsequently released to the member or his heirs.

1.4. In case of member's death, the release of his provident benefit claims shall be in accordance with the laws on succession.

1.5. A member who has multiple employers shall be entitled to claim his entire savings anytime upon occurrence of any of the grounds for membership termination.

2. Death Benefit

2.1. Upon the death of a member, his legal heirs shall be entitled to receive the applicable death benefit in addition to the deceased member's TAV. The amount of the death benefit shall depend on his membership status with the Fund at the time of his death:

2.1.1. For active members at the time of death — P6,000 regardless of the amount of TAV.

2.1.2. For inactive members at the time of death — the amount is equivalent to member's TAV or P6,000, whichever is lower;

2.1.3. If TAV offsetting occurred prior to the member's death — the amount of death benefit to be granted shall depend on the membership status as of date of death. In case of inactive status as of date of death, the TAV under consideration shall be the TAV prior to offsetting.

2.2. The legal heirs of the deceased member may still be entitled to death benefit, subject to the conditions set in Item F subsection 2.1 hereof under the following circumstances:

2.2.1. The check for provident benefit claims based on the grounds for membership termination other than death is not yet released to the member.

2.2.2. The member's provident benefit claim proceeds are not yet credited to his disbursement/cash card or LANDBANK's Payroll Credit Systems Validation (PACSVAL) at the time of his death.

3. Manner of Payment

3.1. The provident benefit claim proceeds due to membership termination shall be paid to the member or his legal heirs through any of the following modes:

3.1.1. Crediting to the claimant's disbursement/cash card;

3.1.2. Crediting to the borrower's bank account through LANDBANK's Payroll Credit Systems Validation (PACSVAL);

3.1.3. Through check payable to the claimant; or

3.1.4. Other similar modes of payment approved by the Board.

3.2. Claiming of checks through a representative shall be allowed provided the representative shall present the documents that the Fund may require relative to the provident benefit claim.

G. OTHER PROVISION

If after membership termination a member places himself in a situation that would subject him to mandatory coverage, he shall continue to be mandatorily covered by the Fund. His employer shall continue to deduct and remit the monthly savings together with the corresponding employer's counterpart savings.

H. MECHANISM ON RESOLUTION OF ISSUES

Any issue in the interpretation and implementation of this Guidelines shall, as much as possible, be resolved by the concerned officer. Matters that are not thereby satisfactorily resolved shall be escalated to the next higher approving authorities.

I. REPEALING CLAUSE

Any circular, clarificatory memo, rules, regulations and other issuances inconsistent herewith are hereby repealed, amended or modified accordingly.

J. EFFECTIVITY

These guidelines shall take effect after fifteen (15) days following the completion of their publication in a newspaper of general circulation.

Makati City, May 12, 2017.

 

(SGD.) ACMAD RIZALDY P. MOTIOfficer-in-ChargeChief Executive Officer