Federal Retirees: Changing Life Insurance Through Opm

Federal retirees can make changes to their life insurance through the Office of Personnel Management (OPM). The Federal Employees' Group Life Insurance (FEGLI) Program is a group life insurance program that covers over 4 million federal employees and retirees, as well as their family members. While retirees can't increase their coverage, they can cancel or decrease it at any time. They can also reduce their premiums by reducing their coverage. However, any reduction or cancellation of coverage after retirement is permanent and cannot be increased again later.

Federal retirees can keep their basic life insurance benefits if they meet certain conditions

To retain basic life insurance coverage after retirement, federal employees must satisfy all the following conditions:

• They must be enrolled in basic life insurance under the FEGLI program when they retire.
• They must not have converted their life insurance coverage to an individual policy.
• They must have had life insurance coverage for the five years immediately preceding retirement or for the full periods of federal service when coverage was available (if coverage was less than five years).
• Their annuity payments must start within 30 days of retirement.

It is important to note that if a federal employee is retiring under the Minimum Retirement Age (MRA) plus 10 provision of FERS, their health care and life insurance coverage will be suspended until their annuity starts, even if it is postponed.

While retirees can keep their basic life insurance benefits, they cannot increase their coverage after retirement. They can, however, cancel or decrease their coverage at any time. The cost of basic insurance is shared between the retiree and the government, with the retiree paying 2/3 of the total cost. The FEGLI Calculator is a useful tool that helps determine the face value of various FEGLI coverage combinations, calculate premiums, and understand how different options impact the life insurance amount and premium withholdings over time.

Federal retirees can keep their optional life insurance benefits if they meet certain conditions

To keep their optional life insurance benefits after retirement, federal employees must meet the following conditions:

• They must be eligible to continue their Basic coverage.
• They must have had optional life insurance for the 5 years immediately preceding retirement or for the full periods of federal service when coverage was available (if it was less than 5 years).

It is important to note that retirees cannot increase their coverage after retirement and any reduction or cancellation of coverage after retirement is permanent. The cost of Basic insurance is shared between the retiree and the government, while the retiree pays the full cost of Optional insurance. The FEGLI Calculator is a useful tool provided to help determine the face value, calculate premiums, and understand how different options can change the amount of life insurance and premium withholdings.

By meeting the eligibility requirements, federal retirees can ensure they maintain their optional life insurance benefits and have peace of mind that their chosen beneficiaries will receive the intended benefits.

Federal retirees can cancel or decrease their life insurance coverage at any time

It is important to note that while federal retirees can cancel or decrease their coverage, they cannot increase it after retirement. Any reduction or cancellation of coverage after retirement is permanent. Additionally, eligibility requirements for continuing life insurance coverage cannot be waived by the Office of Personnel Management (OPM). If a retiree is not eligible to continue their coverage, they will be given the opportunity to convert to an individual policy.

To ensure that life insurance benefits are paid out to designated beneficiaries, federal retirees can complete a Designation of Beneficiary (SF-2823) form. This form is necessary if the retiree wishes for their life insurance to be paid differently than the statutory order of precedence, which includes the retiree's widow or widower, children, parents, appointed executor or administrator of their estate, and next of kin.

The FEGLI Calculator is a useful tool provided by the government that allows retirees to determine the face value of various combinations of FEGLI coverage, calculate premiums, and understand how choosing different options can change their coverage and premium withholdings. Overall, while federal retirees have the flexibility to cancel or decrease their life insurance coverage, it is important to carefully consider these decisions as they are permanent and cannot be increased at a later date.

Federal retirees cannot increase their life insurance coverage after retirement

The Federal Employees' Group Life Insurance (FEGLI) Program was established in 1954 and is the largest group life insurance program in the world, covering over 4 million federal employees and retirees, as well as their family members. Most employees are eligible for FEGLI coverage, which provides group term life insurance. While FEGLI coverage does not build up any cash value or paid-up value, it can be continued into retirement. The FEGLI retirement benefit is pre-funded by premium costs, so that after age 65, or at retirement if later, some coverage can be continued by retirees at no extra cost.

The cost of basic insurance coverage is the same for each enrollee in the group policy, regardless of age or health status. This means that younger employees may pay a comparatively higher premium than they would with coverage based on age. However, younger employees are covered by an additional basic insurance provision called the Extra Benefit, which doubles the amount of basic insurance payable at no extra cost for enrollees aged 35 or younger. Beginning on an enrollee's 36th birthday, the Extra Benefit decreases by 10% each year until age 45, after which there is no Extra Benefit.

In addition to basic life insurance coverage, there are three optional coverages available: Option A-Standard, Option B-Additional, and Option C-Family. These optional coverages are not automatic, and federal employees must take action to elect them. The cost of optional insurance depends on the age of the federal employee, with older employees paying higher premiums. While federal retirees cannot increase their life insurance coverage after retirement, they can reduce their coverage or cancel it altogether. However, any reduction or cancellation of coverage after retirement is permanent.

Federal retirees can reduce their life insurance premiums by reducing their coverage

FEGLI provides group term life insurance, which does not accumulate cash value over time. The program consists of Basic life insurance coverage and three optional forms of insurance. While Basic insurance is often automatic for new federal employees, optional insurance requires separate election.

The cost of Basic insurance is shared between the government and the individual, with the individual paying 2/3 of the total cost. Notably, age does not factor into the cost of Basic insurance. On the other hand, the individual pays the full cost of Optional insurance, and the price depends on their age.

While retirees can reduce their coverage at any time, it is important to note that any reduction or cancellation of coverage after retirement is permanent and cannot be increased again later.

Frequently asked questions