The Pension Protection Fund (PPF) has announced that changes to terminal illness provisions for PPF and Financial Assistance Scheme (FAS) members, following the Pension Schemes Act 2026, have come into effect.

The changes will extend the life expectancy criterion for affected members from six months to 12 months.

Previous legislation stipulated that PPF and FAS members were eligible to receive a terminal ill health payment if they had been diagnosed with a terminal illness and were expected to have up to six months to live.

This has been changed to 12 months, bringing the provision broadly in line with the Department for Work and Pensions’ social security payment rules.

Terminally ill members will therefore be able to receive payments earlier, helping eligible members to access their benefits sooner.

Members with a terminal illness where a doctor confirms they have up to 12 months to live can receive a terminal ill health payment before reaching their normal pension age.

For PPF members, this is typically a one-off tax-free lump sum equal to two years of compensation, while FAS members can begin receiving their monthly assistance payments earlier.

“We welcome this change, which will help terminally ill PPF and FAS members access financial support sooner, at a time when it can make a real difference,” said PPF chief customer officer, Sara Protheroe.

“For members and their families facing an incredibly difficult period, having greater certainty and flexibility can help ease some of the financial pressure.”

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