What FEGLI Is
Federal Employees' Group Life Insurance (FEGLI) is a group term life insurance program available to eligible federal employees. It is separate from the retirement annuity and separate from the Thrift Savings Plan.
Coverage is term insurance, which means it provides a death benefit but does not build cash value. Premiums are generally paid through payroll deductions while you are in service.
Coverage Options
FEGLI is organized into several parts, commonly described as follows:
- Basic: A standard amount of coverage, generally equal to your annual pay rounded up to the next thousand plus a fixed additional amount, with the government contributing to the cost.
- Option A: Additional coverage in a fixed amount, paid entirely by the employee.
- Option B: Coverage in multiples of your salary, with premiums that depend on age.
- Option C: Family coverage for a spouse and eligible children, with premiums that depend on age.
Eligibility for each option and the exact premium rates are set by program rules and can change. Check the current official schedule before deciding.
How Coverage Changes With Age and Retirement
Many FEGLI benefits reduce as the insured person gets older, and coverage is generally affected when someone retires. Some retirees may be able to keep part of their coverage, with premiums withheld from the annuity rather than from payroll. The rules for continuing coverage in retirement are specific and have conditions attached.
Questions to Review Before You Retire
- Which FEGLI options do I currently carry, and what do they cost?
- Will any coverage continue into retirement, and at what amount?
- Do I need coverage to protect a spouse, children, or a mortgage?
- Have I confirmed my beneficiary designation for FEGLI?
- Are there other life insurance policies that should be considered together?
Where to Confirm Details
Because FEGLI premiums, reduction schedules, and continuation rules can change, confirm the current terms with the official program materials. The OPM Retirement Services website is a common starting point. For personalized insurance advice, consult a licensed insurance professional.
A Worked Example of Basic Coverage
Basic insurance is generally your annual rate of basic pay, rounded up to the next $1,000, plus $2,000. For an employee whose annual pay is $72,400, the pay rounds up to $73,000, and adding $2,000 gives Basic coverage of $75,000. A higher-paid employee has a larger amount, and the program sets a minimum amount for lower-paid employees. Premium rates change, so use the current schedule on the OPM website to see what you would pay.
Keeping FEGLI in Retirement
Coverage does not automatically continue when you retire. OPM states several conditions, including the following:
- You must be enrolled in Basic insurance when you retire, and you must not have converted your coverage to an individual policy.
- You must have had the coverage for the 5 years immediately before retirement, or for the full period it was available to you if that was shorter.
- Your annuity must begin within 30 days of your retirement. If you retire under the minimum retirement age plus 10 provision of FERS, health and life insurance are suspended until the annuity starts.
- Optional coverage (Options A, B and C) can generally continue only if you are eligible to continue Basic and meet the same five-year requirement for the option.
OPM has no authority to waive these requirements. If you are not eligible to continue coverage, you generally have the opportunity to convert to an individual policy within a limited time. Make sure you know the deadline with your human resources office.
Choosing a Reduction in Retirement
When you continue Basic insurance, you choose how it reduces after age 65. In general, there are three choices: a 75 percent reduction, a 50 percent reduction, or no reduction. A larger reduction means lower premiums (the 75 percent reduction is generally free to the retiree) but a smaller death benefit over time, while no reduction keeps the full amount and costs more. The reduction generally begins in the second month after your 65th birthday or your retirement date, whichever is later. If you do not choose, a default applies, so make an active choice.
Beneficiaries
Your FEGLI beneficiary is set by a designation form (Standard Form 2823), which is filed with your human resources office while you work or with OPM after retirement. Beneficiary records are not available online. Review your designation after any marriage, divorce, birth, or death in the family, and keep it consistent with your other beneficiary forms.
Common Mistakes to Avoid
- Assuming FEGLI continues automatically without checking the five-year enrollment rule.
- Missing the deadline to continue coverage or convert to an individual policy.
- Forgetting that your annuity must start within 30 days for coverage to continue.
- Letting an old beneficiary designation stay in place after a major life event.
- Choosing a reduction option without comparing the premiums and the remaining death benefit.
Frequently Asked Questions
Is FEGLI the same as TSP or my annuity?
No. FEGLI is group term life insurance and is separate from your retirement annuity and from the TSP. It pays a death benefit only and does not build cash value.
Does FEGLI cost the same in retirement?
Not necessarily. Premiums for retirees are generally withheld from the annuity and depend on the coverage and reduction option you choose. Check the current rates with OPM.
Can I increase my coverage when I retire?
Generally no. You can continue the coverage you already have, but you cannot add coverage at retirement. Review your needs before you leave service.
Where can I confirm my current coverage?
Employees can ask their human resources office. Annuitants can view their coverage through OPM’s retirement services, which provide a verification of life insurance on request.