Understanding Federal Employee Life Insurance: A Comprehensive Guide

Federal employee life insurance offers essential coverage for government employees, providing financial security for their families. Understanding the options, benefits, and processes can help you make informed decisions about your coverage.

What is Federal Employee Life Insurance?

Federal Employee Group Life Insurance (FEGLI) is the primary program providing life insurance to federal employees. Established in 1954, it offers basic life insurance and options for additional coverage.

Basic Life Insurance Coverage

The basic coverage amount is equal to an employee's annual salary rounded up to the nearest thousand plus $2,000. The federal government pays one-third of the premium cost.

Optional Coverage

• Option A: Adds $10,000 of coverage.
• Option B: Allows employees to choose up to five times their salary in additional coverage.
• Option C: Offers coverage for family members, including spouse and eligible children.

How to Enroll and Manage Your Policy

Enrollment in FEGLI is automatic for new employees. However, changes to coverage require completion of specific forms and adherence to open season or qualifying life events.

Making Changes to Your Coverage

Employees can increase, decrease, or cancel coverage by submitting a completed Standard Form 2817 during open seasons or after a qualifying life event.

Real-World Example

Consider Jane, a federal employee who used a single premium life insurance calculator to assess her additional coverage needs beyond FEGLI, ensuring comprehensive protection for her family.

Understanding Premiums and Costs

The cost of FEGLI premiums depends on age, salary, and the options chosen. Employees can refer to the FEGLI Handbook for detailed premium rate charts.

Age and Cost Considerations

Premiums increase as employees age. It's crucial to evaluate the cost-effectiveness of maintaining optional coverage as you near retirement.

Small group life insurance policies may offer competitive rates; exploring options with small group life insurance companies can be beneficial.

FAQs About Federal Employee Life Insurance

• What happens to my FEGLI coverage when I retire?

  Retirees can continue their basic coverage at no cost after age 65, but optional coverage requires continued premium payments unless the coverage is reduced.

• Can I convert my FEGLI to an individual policy?

  Yes, employees can convert their FEGLI coverage to an individual policy with a participating insurance company, but this must be done within 31 days of leaving federal service.

• How do I know if I am eligible for FEGLI?

  Most federal employees are automatically eligible for FEGLI unless excluded by law or regulation. Check with your human resources office for specific eligibility details.