Australian Defence Force Cover Act 2015

This section applies if, on a day (the conversion day), the annual rate of a single pension payable to or for one or more persons under this Act is less than:

$5,000 a year; or

if a greater rate is prescribed by the rules—that greater rate.

The pension ceases to be payable on the conversion day (and is not payable on any later day), despite any other provision of this Act.

Instead, a single lump sum is payable to or for the person or persons.

The amount of the lump sum is worked out using the formula:

If:

the pension is invalid’s spouse pension or pension payable under section 34 (because the surviving spouse of a covered ADF member who dies chose to receive the benefit for the member’s death as a pension); and

the annual rate of the pension on the conversion day is affected by the spouse pension child supplement percentage;