Learn About Basic and Optional Life Insurance Coverage

Learn About Basic and Optional Life Insurance Coverage

FEGLI offers two different types of coverage: Basic and Optional. FEGLI coverage is the same whether the employee is covered by CSRS (the Civil Service Retirement System), or FERS, (Federal Employees Retirement System). The employee can choose from three different optional coverage options. While the basic FEGLI is issued to the employee as soon as they begin working, it’s likely that the employee will want to select one or more of them. You can choose the type of coverage and the amount you want, and you can also decide which federal retirement benefits to keep. Your choices may change as your circumstances and needs change. The FEGLI program is open to both full-time and part-time federal employees. However, participation in the plan is voluntary. It can also be cancelled if a cheaper policy can be found or if the employee does not need insurance.

Basic Insurance Coverage

FEGLI’s Basic Insurance Coverage is issued automatically to the employee as soon as they begin service, unless they waive the coverage. This insurance provides immediate protection for their beneficiaries in case of death.

The amount of this life insurance for federal employees is equal to the annual salary of the employee, rounded to the nearest $1000 and an additional $2000.

The employee pays two thirds of these costs, while the government covers the remainder.

U.S. Postal Service pays 100 % of Basic FEGLI cost for Postal Employees. Employees are responsible for any optional insurance they choose.

The optional insurance coverage

FEGLI offers three additional optional plans for federal employees’ life insurance. You must first have the basic plan in order to choose any of the optional plans. This coverage is based on your age, and you are responsible for paying the cost.

You can choose from three different types of coverage:

Option A: Standard Optional Insurance

This insurance covers a maximum of $10,000.

Costs are determined by age. Each participant is assigned a specific band of age.

Option B: Additional Optional Insurance

* Option A is a fixed coverage amount, while option B can be five multiples of your annual salary (1, 2, 3, 4, or 5).

This insurance is also priced according to the age groups of 35, 40,45, 50,55, 60,65, and 70.

Option B is a good option for young employees. You should compare the FEGLI cost with other private term life insurance policies as you age. If you’re over 45, or you want to insure your family beyond the age of 50, you can save a lot. FEGLI Calculator is highly recommended to compare your FEGLI rate with other options for term life insurance.

Option C: Family Optional Insurance

This group term insurance program covers your entire family, i.e. Your spouse and any children who are dependent on you. You can choose to pay in multiples of 1, 2, 3 or 5, depending on your preference.

* The multiples equal $5000 for you spouse and $2,500 each for eligible children. If you select a multiple 4 you will get $20,000 if your spouse dies and $10,000 if any of your children die.

The insurance cost is determined by your age, not the age of your family members. Total costs are determined by the same age bands.

Aside from the Basic FEGLI and FEGLI Option A and B, FEGLI Option C and FEGLI Option C benefits, federal and postal employees who are eligible can also receive additional benefits, such as Accidental Death and Disability Benefit, Basic Extra Life Benefit and more.

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