Subject to subparagraph (ii) of this paragraph, when the Board of Trustees receives proof of death of an individual who died while employed as a member, the Board of Trustees shall pay to the designated beneficiary or, if there is no designated beneficiary, to the member’s estate the amounts specified in this subsection. If a member designates more than one beneficiary, on the death of the member, the Board of Trustees shall pay the amounts specified in this subsection in equal shares to each of the designated beneficiaries. Subject to paragraph (1) of this subsection, the Board of Trustees shall pay the member’s accumulated contributions. Subject to paragraph (1) of this subsection, the Board of Trustees shall pay an amount equal to the member’s annual earnable compensation at death if the member dies in the course of the performance of duty or the member has at least 1 year of eligibility service. A death benefit under this section may not be paid for the death of a member of the State Police Retirement System if a special death benefit under § 29–204 of this subtitle is paid for that death. A death benefit under this section may not be paid for the death of a member of the Correctional Officers’ Retirement System if a special death benefit under § 29–204.1 of this subtitle is paid for that death. A death benefit under this section may not be paid for the death of a member of the Employees’ Retirement System, Employees’ Pension System, Teachers’ Retirement System, or Teachers’ Pension System if a special death benefit under § 29–204.2 of this subtitle is paid for that death. A death benefit under this section may not be paid for the death of a member of the Law Enforcement Officers’ Pension System if a special death benefit under § 29–203 of this subtitle is paid for that death. A death benefit under this section may not be paid for the death of a member if a retirement allowance under § 29–205 or § 29–206 of this subtitle is paid for that death. If all individuals who are eligible for a special death benefit under § 29–203, § 29–204, § 29–204.1, or § 29–204.2 of this subtitle elect to waive the payment of a special death benefit, a benefit shall be paid in accordance with subsection (a) of this section. If all individuals who are eligible for an allowance under § 29–205 or § 29–206 of this subtitle elect to waive the payment of an allowance, a benefit shall be paid in accordance with subsection (a) of this section. The Board of Trustees may provide the death benefit as group life insurance if the Board of Trustees finds that the designated beneficiaries would receive a more favorable tax treatment of the death benefit.