Federal Employees' Group Life Insurance Act Overview and Details

The Federal Employees' Group Life Insurance Act is a vital benefit for federal employees and their families. It provides a basic life insurance coverage of $10,000 to federal employees and their spouses.

This coverage is automatic, meaning you don't have to do anything to sign up. You're automatically enrolled when you're hired or when you become a spouse of a federal employee.

The coverage is also portable, meaning you can take it with you if you leave federal service. This is a big deal, as it ensures you and your family are protected no matter what your career path looks like.

The federal government is responsible for maintaining insured personnel files, but some federal courts have held that no duty exists to properly maintain FEGLI records. This means that if you're a federal employee with group life insurance, it's crucial to follow up on any beneficiary designations to ensure your personnel file accurately reflects your intentions.

Prior to the Graber decision, the Fifth Circuit concluded in Metropolitan Life v. Atkins that the federal government does have a duty to properly maintain beneficiary designation forms. However, other federal courts have limited the United States' duty under the Act to only negotiating and issuing the correct FEGLI life insurance policy.

It's essential to consult with a life insurance lawyer about your denied life insurance claim or beneficiary dispute, especially given the split among federal courts.

Federal employees are automatically guaranteed Basic life insurance coverage on the date they are eligible for FEGLI. This coverage is guaranteed, but employees can opt out by notifying their employer in writing.

Premiums for FEGLI coverage are automatically deducted from employees' paychecks unless they choose to opt out. If an employee doesn't wish to participate in FEGLI, they must notify their employer in writing before the coverage takes effect.

The Basic insurance amount (BIA) for federal employees is either the employee's annual rate of basic pay, rounded to the next higher thousand, plus $2,000, or $10,000, whichever is higher. This amount is effective for pay periods beginning on or after October 30, 1998, and there is no maximum BIA.

The BIA automatically changes whenever an employee's annual pay is increased or decreased by an amount sufficient to raise or lower pay to a different $1,000 bracket. This means that employees will receive a new BIA based on their updated pay.

Here's a breakdown of the factors used to calculate an employee's Basic Life insurance coverage based on their age:

Each nonexcluded federal employee is automatically insured for Basic insurance unless they waive it.

To elect Optional insurance, an employee must specifically choose it, as it's not automatic. They can opt for one or more types of Optional insurance if they already have Basic insurance and don't have a waiver of that type still in effect.

During an open enrollment period, eligible employees can cancel their existing waivers of Basic and/or Optional insurance by electing the insurance in a manner designated by OPM.

As a Federal employee, you're automatically insured for Basic insurance unless you waive it. This means you don't have to do anything to get Basic insurance, it's just part of your benefits package.

You can, however, elect to have Optional insurance, but you have to specifically choose it - it's not automatic like Basic insurance. To elect Optional insurance, you need to have Basic insurance and not have a waiver of that type or Option B insurance still in effect.

The hiring of a Federal employee for a temporary, intermittent position with the decennial census doesn't affect their Basic or Option B insurance, withholdings, or Government contribution. This means that even if you're hired for a temporary census job, your life insurance benefits stay the same.

As a former Federal employee of the Civilian Marksmanship Program, you're eligible for life insurance benefits if you were employed by the Department of Defense to support the program and were offered and accepted employment by the Corporation for the Promotion of Rifle Practice and Firearms Safety. This means you're treated as a Federal employee for life insurance purposes, even if you're no longer working for the Federal Government.

If you're an employee who enters on active duty or active duty for training in one of the uniformed services for more than 30 days, you can continue your enrollment for an additional 12 months, for a total of up to 24 months. This means you can keep your life insurance coverage even if you're deployed or on active duty.

If you're in nonpay status, you're entitled to continue life insurance for up to 12 months without making premium payments, unless you're receiving compensation.

You can continue life insurance even if you accept a temporary appointment to a position that normally wouldn't be covered, but the amount of insurance will be based on the combined salaries of the two positions.

You'll still need to make withholdings from your pay in the temporary position.

If you go on leave without pay to serve as a full-time officer or employee of an employee organization, you can elect to continue life insurance within 60 days, but you'll have to pay the full cost of insurance starting with the beginning of your nonpay status.

You won't be entitled to the 12 months of free coverage in this situation.

If you're assigned to a State government, local government, or institution of higher education while on leave without pay, you can elect to continue life insurance for the length of your assignment, but you'll need to make your own premium payments to the Federal agency on a current basis.

If you're being transferred to an international organization, you may be able to continue your life insurance coverage.

You can continue life insurance coverage as provided in 5 U.S.C. 3582. Regulations governing these transfers are in part 352 of this title.

You can elect to add family coverage to your plan, which will automatically cover your spouse and eligible dependent children. This option is called Option C – Family Life Insurance.

Each multiple of coverage is equal to $5,000 for your spouse and $2,500 for each of your eligible dependent children. You can choose to have either one, two, three, four, or five multiples of coverage.

For example, if you elect three multiples, you'll receive $15,000 if your spouse passes away, and $7,500 if one of your eligible dependent children dies. This is because each multiple is a unit, so if you elect two multiples, you'll have two multiples on your spouse and two multiples on your eligible dependent children.

To be eligible for family coverage, your children must be dependent, unmarried, and under age 22, or if they're 22 or over, they must be incapable of self-support due to a mental or physical disability that existed before they turned 22. This includes your natural children, adopted children, recognized natural children, and stepchildren and foster children if they live with you in a regular parent-child relationship.

There are two main types of life insurance under the FEGLI Program: Basic and Optional. Basic insurance is the standard coverage that comes with being a federal employee, while Optional insurance offers additional protection for employees and their families.

Optional insurance comes in three forms: Option A, Option B, and Option C. Option A provides standard additional coverage, Option B offers additional coverage, and Option C provides family coverage.

The FEGLI policy is a contract with the company or companies that issue a policy under § 8709 of title 5, United States Code. This contract outlines the terms and conditions of the policy, including the payment of benefits.

Basic, Option A, Option B, and Option C benefits are payable according to this contract. Any disputes or claims must be taken directly against the company that issues the policy.

The policy is designed to provide a clear and straightforward way to resolve any issues that may arise. This includes any court actions to obtain money due from the insurance policy.

It's essential to understand the terms of the policy to ensure that you receive the benefits you're entitled to. By knowing the policy, you can make informed decisions about your coverage and benefits.

Accidental death and dismemberment insurance is an automatic part of Basic and Option A insurance for employees.

Accidental death benefits under Basic insurance are equal to the Basic Insurance Amount (BIA), but without the age factor.

Accidental death benefits are paid to the employee's beneficiaries.

Accidental dismemberment benefits for the loss of a hand, foot, or the vision in one eye under Basic insurance are equal to one-half the BIA.

Accidental dismemberment benefits are paid to the employee.

Accidental dismemberment benefits for the loss of 2 or more of these in a single accident under Basic insurance are equal to the BIA.

Accidental dismemberment benefits for the loss of 2 or more of these in a single accident under Option A are equal to the amount of Option A.

You can elect Option B, also known as additional optional insurance, which offers more coverage than Option A.

For Option B, you can choose from various coverage amounts, but the specifics are not provided in the article section.

You can also elect Option C, family optional insurance, which offers coverage for your dependents.

The article section does not provide information on the specifics of Option C coverage amounts or how it works.

To make an informed decision about electing Options B and C, it's essential to review the contract with the insurance company, as stated in § 870.102.

You can cancel or reduce your Federal Employees' Group Life Insurance (FEGLI) coverage at any time by filing a Life Insurance Election form (SF 2817). Simply sign only for the insurance you wish to keep.

If you don't sign for a particular type of insurance, you have automatically cancelled it. Cancelling Basic insurance also cancels all forms of Optional insurance.

You can waive Basic insurance coverage at any time by filing a waiver with your employing office, OPM, or other office that administers your retirement system. The waiver is effective at the end of the pay period in which it's properly filed.

An individual who cancels their Basic insurance automatically cancels all forms of Optional insurance. If you have assigned your insurance under subpart I of this part, you cannot cancel the insurance.

You can cancel or reduce Optional insurance, including Option B, at any time by filing a waiver with your employing office, OPM, or other office that administers your retirement system. The cancellation becomes effective at the end of the pay period in which the waiver is properly filed.

If you cancel Option C because there are no eligible family members, the effective date of the cancellation is retroactive to the end of the pay period in which there stopped being any eligible family members.

Federal employees who have group life insurance through the Federal Employees' Group Life Insurance Act have rights regarding termination and conversion. Termination occurs under specific conditions, including separation from service, 12 months in nonpay status, or insufficient pay to cover premiums.

If an insured individual's group insurance terminates, an assignee has the right to convert their share of the insurance to an individual policy. This conversion right is triggered when the assigned group insurance terminates, and the employing office must notify each assignee of this right at the time of termination.

The maximum amount of insurance an assignee can convert is determined by their share of the total insurance, rounded up to the next higher thousand dollars if necessary. Premiums for the converted life insurance are based on the insured individual's age and class of risk at the time the conversion policy is issued.

The 31-day temporary extension of life insurance coverage for conversion to an individual policy can be a lifesaver for those who need more time to decide. During this period, FEGLI coverage remains in effect, giving individuals a chance to review their options and make an informed decision.

If you're returning to pay and duty status after a period of more than 12 months of nonpay status, you're automatically insured at the time you actually enter on duty in pay status.

You can't file a waiver of Basic insurance coverage with your employing office before the end of the first pay period after returning to duty.

If you waived Basic insurance on or before February 28, 1981, your waiver was automatically cancelled effective on the 1st day you entered on duty in pay status on or after April 1, 1981.

Basic insurance coverage was automatically effective on the date of the waiver's cancellation, unless you filed a new waiver of Basic insurance with your employing office before the end of the pay period during which the coverage became effective.

You'll need to check your pay and premium pay to see if it reaches the annual salary cap, as this can affect the amount of coverage you have.

Termination of life insurance coverage can happen in various situations. You'll lose coverage on the date you separate from federal service, although you may be eligible to continue coverage as an annuitant or while in receipt of workers' compensation benefits.

Your life insurance coverage will stop on the earliest of four dates: the date you separate from federal service, the end of a 12-month period in nonpay status, at the end of the last pay period in which your agency withheld life insurance premiums from your pay, or the end of the last day of the pay period during which your human resources office receives your Life Insurance Election.

FEGLI will terminate on the date a Federal employee separates from the service or 12 months after discontinuance of his pay.

There is a 31-day temporary extension of life insurance coverage for conversion to an individual policy of life insurance during which FEGLI coverage will remain in effect.

If you're an assignee, you have the right to convert all or part of the group insurance to an individual policy on the insured individual when their insurance terminates.

Each assignee has the right to convert all or part of his/her share of the insurance, and any assignee who doesn't convert loses all ownership of the insurance.

The maximum amount of insurance each assignee can convert is determined by the dollar amount corresponding to the assignee's share of the total insurance, rounded up to the next higher thousand if necessary.

Here's a summary of the key dates for termination and conversion:

Insurance under this subpart terminates 12 months after hostage status ends, unless the individual cancels the insurance earlier.

The insured individual is eligible for the 31-day extension of coverage and conversion as set forth in subpart F of this part, unless the individual cancelled the coverage.