Federal Employees: Life Insurance For Singles Explained

Single federal employees in the US are eligible for life insurance under the Federal Employees' Group Life Insurance (FEGLI) Program, which 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 families. FEGLI provides term life insurance, which means it does not build up any cash value or paid-up value. Most federal employees are automatically covered by Basic life insurance, which is shared between the employee and the government, with the employee paying 2/3 of the total cost. In addition to Basic, there are three forms of Optional insurance that employees can elect within 31 days of becoming eligible.

Federal Employees' Group Life Insurance (FEGLI)

Federal Employees Group Life Insurance (FEGLI) is the largest group life insurance program in the world, covering over 4 million federal employees, retirees, and their family members. Established on August 29, 1954, FEGLI offers term life insurance to eligible federal government employees.

Most federal employees are eligible for FEGLI coverage, which includes Basic life insurance and three optional insurance plans. In most cases, new federal employees are automatically enrolled in Basic life insurance and have premiums deducted from their paycheck unless they waive coverage. The cost of Basic insurance is shared between the employee and the government, with the employee paying 2/3 of the total cost.

The Basic insurance coverage provides employees with life insurance equal to their actual rate of annual basic pay (rounded to the next $1,000) plus $2,000, or $10,000, whichever is greater. There is also an Extra Benefit for employees under age 45, which doubles life insurance benefits until age 36 and then decreases at 10% per year until age 45.

In addition to the Basic plan, there are three forms of Optional insurance that employees can elect. To be eligible for Optional coverage, employees must first have Basic insurance. Unlike Basic, enrollment in Optional insurance is not automatic—employees must take specific action to elect the desired options within a set timeframe. The three Optional insurance plans include:

• Option A - Standard: Provides an additional $10,000 of coverage, which doubles in the case of accidental death.
• Option B - Additional: Allows employees to select one to five multiples of their basic pay (rounded to the next even $1,000).
• Option C - Family: Insures an employee's eligible family members, providing $5,000 per multiple for a spouse and $2,500 per multiple for each eligible child. Employees can elect up to five multiples of Option B and/or C.

Basic and Optional coverage

Federal Employees' Group Life Insurance (FEGLI) is the largest group life insurance program in the world, covering over 4 million Federal employees, retirees, and their family members. Most federal employees are eligible for FEGLI coverage, which provides group term life insurance. This means it does not build up any cash value or paid-up value.

FEGLI consists of Basic life insurance coverage and three options for additional coverage. New federal employees are typically automatically covered by Basic life insurance, with premiums deducted from their paycheck unless they waive coverage. Basic life insurance is equal to the actual rate of annual basic pay (rounded to the next $1,000) plus $2,000, or $10,000, whichever is greater. There is also an Extra Benefit for employees under age 45: double life insurance benefits until age 36, decreasing at 10% per year until age 45.

In addition to the Basic coverage, there are three forms of Optional insurance that employees can elect:

• Option A - Standard: Provides an additional $10,000 of coverage, which doubles in the case of accidental death.
• Option B - Additional: Provides one to five multiples of the employee's basic pay (rounded to the next even $1,000).
• Option C - Family: Insures an employee's eligible family members, with each multiple equal to $5,000 upon the death of a spouse and $2,500 upon the death of an eligible child. Employees may elect up to five multiples of Options B and/or C.

It is important to note that employees must have Basic coverage to be eligible for any of the Optional coverage. While Basic coverage is typically automatic, enrollment in Optional coverage is not, and employees must take specific action to elect these options within a limited time frame. The cost of Basic insurance is shared between the employee and the government, while employees pay the full cost of Optional insurance, which depends on their age.

Eligibility and enrolment

Federal Employees' Group Life Insurance (FEGLI) is the largest group life insurance program in the world, covering over 4 million Federal employees, retirees, and their family members. Most employees are eligible for FEGLI coverage, which provides group term life insurance. This means it does not build up any cash value or paid-up value.

In most cases, if you are a new Federal employee, you are automatically covered by Basic life insurance, and your premiums are deducted from your paycheck unless you waive the coverage. Basic Life Insurance is equal to the actual rate of annual basic pay (rounded to the next $1,000) plus $2,000, or $10,000, whichever is greater. There is also an Extra Benefit for employees under age 45: double life insurance benefits until age 36, decreasing at 10% per year until age 45, when the extra coverage ends.

In addition to the Basic coverage, there are three forms of Optional insurance you can elect. However, you must have Basic insurance to be eligible to elect any of the options. Unlike Basic enrollment, Optional insurance is not automatic—you must take action to elect the options. You must specifically elect the types of optional insurance you wish to carry within 31 days of becoming eligible. There are limited opportunities to enroll or elect optional coverage: within 60 days of hire, as a result of a Qualifying Life Event (QLE), within 60 days of an approved Request for Insurance (SF-2822), or during a rare FEGLI Open Season.

The three forms of Optional insurance are as follows:

• Option A - Standard, which provides an additional $10,000 of coverage, and doubles in the case of accidental death.
• Option B - Additional, which provides one to five multiples of pay.
• Option C - Family, which insures an employee's eligible family members from one to five multiples of coverage, with each multiple equal to $5,000 upon the death of a spouse and $2,500 upon the death of an eligible child.

The cost of Basic insurance is shared between the employee and the Government. Employees pay 2/3 of the total cost, and the Government pays 1/3. The age of the employee does not affect the cost of Basic insurance. However, employees pay the full cost of Optional insurance, and the cost depends on their age.

Premiums and costs

Federal Employees' Group Life Insurance (FEGLI) is a comprehensive program that offers term life insurance to eligible federal government employees. As of December 2020, over four million people were enrolled in FEGLI, making it the largest group life insurance program in the world. The program is administered by the Office of Personnel Management (OPM), with the Metropolitan Life Insurance Company (MetLife) providing the insurance policies.

FEGLI offers two types of coverage: Basic and Optional. The Basic coverage is automatically provided to most new federal employees, while the Optional coverage must be elected by the employee within a specified timeframe. The Basic insurance amount (BIA) is shared between the employee and the government, with the employee paying 2/3 of the total cost and the government contributing 1/3. This differs from the Optional insurance, where the employee pays the full cost. The cost of Optional insurance depends on the employee's age.

The Basic Life Insurance amount is calculated as the employee's annual basic pay rate (rounded to the next $1,000) plus $2,000 or $10,000, whichever is greater. Additionally, there is an Extra Benefit for employees under the age of 45, providing double the life insurance benefits until age 36, decreasing by 10% each year until age 45.

Optional insurance coverage includes three options: Option A, Option B, and Option C. Option A provides an additional $10,000 in coverage, which doubles in the case of accidental death. Option B allows employees to select one to five multiples of their basic pay, rounded to the next even $1,000. Option C is family coverage, providing insurance for the employee's eligible family members, with each multiple equating to $5,000 for a spouse and $2,500 for each eligible child.

Employees can calculate their FEGLI coverage and estimate their premiums using the FEGLI Calculator. This tool helps employees understand the financial implications of their life insurance choices and make informed decisions about their coverage options.

Claiming insurance

Federal employees are covered by the Federal Employees' Group Life Insurance (FEGLI) Program, which was established in 1954 and is the largest group life insurance program in the world. Most federal employees are eligible for FEGLI coverage, which includes Basic life insurance coverage and three optional forms of insurance. In most cases, new federal employees are automatically covered by Basic life insurance, with premiums deducted from their paychecks unless they waive coverage.

Understanding the Basics of FEGLI Claims:

When a federal employee passes away, their designated beneficiary or surviving family members can file a claim for death benefits under the FEGLI program. The FEGLI death benefit is a payout to the beneficiary of the life insurance policy, annuity, or pension.

Contact the Appropriate Office:

If a federal employee has died or been dismembered, or if an eligible member of their family has died, contact the employee's federal agency to learn about their coverage under the FEGLI program. The agency maintains FEGLI records for its employees.

In the case of a deceased federal retiree or eligible family member, contact the OPM at 1-888-767-6738. OPM will provide the necessary claim forms and information about FEGLI coverage.

Filing a Claim:

To file a FEGLI claim, call the Office of Federal Employees' Group Life Insurance (OFEGLI) at 1-800-633-4542. Designated personnel will take your claim over the phone. In emergency situations, OFEGLI will follow special procedures and expedite all life insurance claims, processing them as soon as possible.

Alternatively, you can submit a paper claim form, which can be found on the Healthcare & Insurance site or obtained from any federal agency. Mail the completed form to the address provided as soon as possible, without waiting for a death certificate or agency certification.

Understanding the Payout Process:

FEGLI death benefits should be paid by the insurance company within 30 days of receiving the notice of claim and all necessary supporting documents. Processing a claim involves reviewing multiple documents, and the examiner may request additional information. If there is an issue with the claim, such as insufficient documentation or a competing claim, the insurer may delay or deny payment.

Consulting an Attorney for Denied or Delayed Claims:

If your FEGLI claim is denied or delayed, it is recommended to consult a FEGLI attorney to understand the specific reasons behind the denial or delay. FEGLI claims are complex, and there are strict regulations that govern them. Common reasons for denial include beneficiary disputes, invalid or missing beneficiary designations, competing claimants, eligibility issues, and non-payment of premiums.

Understanding Living Benefits:

Living benefits are available to insured federal employees who are terminally ill and have a life expectancy of nine months or less. They can elect to receive a full or partial living benefit, which is paid as a lump sum. If the employee receives only a portion of the FEGLI payout as a living benefit, their beneficiaries will receive the remainder upon the insured's death.

Frequently asked questions