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May Human Resources Advisor Volume 2, Issue 5

Federal Employees Group Life Insurance (FEGLI) Program

General Overview

The Federal Employees’ Group Life (FEGLI) Program became effective on August 28, 1954 and is a Term Insurance program. Managed by the Office of Personnel Management (OPM), the program is governed under 5 Code of Federal Regulations (5 CFR), Part 870, offering eligible employees several choices in selecting the level of life insurance that is right for their individual needs with low group rates and the convenience of payment through payroll deduction.

There are two types of life insurance under the FEGLI Program, Basic and Optional. Participation is entirely voluntary and may be cancelled at any time. FEGLI builds no cash or loan value. It is intended as a form of immediate protection against financial hardship in the event of death.

Amounts and Cost of Insurance:

Basic Insurance Coverage: Basic life insurance coverage is equal to the actual rate of your annual basic pay (rounded to the next $1,000) plus $2,000 (called the Basic Insurance Amount or BIA). For example, if your annual salary were $25,486, you would round up to the next $1,000 ($26,000) and then add $2,000, making a total of $28,000 of coverage. Cost of the basic life insurance to the employee is $0.155 biweekly for each $1,000. The Government pays one-third of the cost and you pay two-thirds. If you are paid on other than a biweekly basis the amount withheld from your pay must be prorated and adjusted to the nearest cent.

There is also an extra benefit, which doubles the amount of basic life insurance coverage; this extra benefit is provided at no cost to the employee. The extra benefit starts decreasing 10% a year at age 36, until the age of 45 when the extra benefit ends.

Optional Coverage: There are three options for Optional coverage. However, you must be enrolled for Basic Life Insurance in order to elect any Optional Insurance Coverage. You pay the full cost of all Optional Insurance. There is no Government contribution toward the cost of any Optional Insurance.

  • Option A (Standard Optional Insurance) - Equals $10,000 worth of coverage. The cost depends on age bands. If you are under the age of 35, the cost is $.30 cents. The cost increases when you reach a new age band. Age bands are 35, 40, 45, 50, 55, 60, 65 or 70. You are considered to reach the next age band the pay period in which your birthday occurs. If you are paid on other than a biweekly basis the amount withheld from your pay must be prorated and adjusted to the nearest cent.

  • Option B (Additional Optional Insurance) - Option B coverage comes in 1, 2, 3, 4, or 5 multiples of your annual pay (after pay has been rounded to the next higher thousand). It does not include the extra $2,000 added for Basic Insurance. The cost also depends on age bands. The same age bands are used for Option B coverage that is used for Option A. If you are under the age of 35, the cost is $0.03 cents per $1,000 of coverage biweekly. If you are paid on other than a biweekly basis the amount withheld from your pay must be prorated and adjusted to the nearest one-tenth of one cent.

  • Option C (Family Optional Insurance) - Option C provides coverage for your spouse and eligible dependent children. When you elect Option C, all eligible family members are automatically covered. You may elect 1, 2, 3, 4, or 5 multiples of coverage. Each multiple is equal to $5,000 for a spouse and $2,500 for each eligible dependent child. For example, if you elect 3 multiples, you would receive $15,000 in the event of the death of your spouse and $7,500 in the event of the death of a child. The cost depends on your age as the employee, not the family member’s age. Option C’s costs are also set according to the same age bands as Option A and B. For example, if you are under the age of 35 and you elected 3 multiples, the cost would be $.27 cents per multiple for a total of $.81 cent.

    Each multiple is a unit. For example, if two multiples are elected, that means there are two multiples on the spouse and two multiples on each dependent child. Employees cannot elect a number of multiples for the spouse that is different from the number of multiples for each dependent child.

    To obtain the total cost of your life insurance, add together the costs for Basic and any Optional Insurance coverage you elect.

  • Accidental Death and Dismemberment Coverage is an automatic part of Basic and Option A Insurance. Benefits are payable when a participant sustains an injury; by accidental means, and within 90 days after the injury, the participant dies or loses a limb or eyesight. The accidental dismemberment benefit is based on the amount for which the participant is insured on the date the accident occurs and the extent of the loss of the dismemberment.

Eligibility:

Unless your position is excluded from coverage by law or regulation, you are eligible to enroll in the FEGLI program. Generally, all full-time and part-time employees on an appointment of more than one year are eligible to enroll. If you are eligible for participation in the program, you will be automatically enrolled in Basic insurance unless you waive this coverage.

Family members eligible for coverage under Option C include a current legal spouse and dependent children. Eligible dependent children must be unmarried and under age 22, or if age 22 or over, incapable of self-support because of a mental or physical disability that existed before the child reached age 22.

Eligible dependent children include natural children, adopted children, and stepchildren (if they live with employees in a regular parent-child relationship), recognized natural children, and foster children (if they live with employees in a regular parent-child relationship). Grandchildren are not eligible family members unless they can qualify as a foster child. Stillborn children are not covered.

A "regular parent-child relationship" means that you are exercising parental authority, responsibility, and control over the child by caring for, supporting, disciplining, and guiding the child, including making decisions about the child’s education and medical care.

Enrollment:

As a new employee, you are automatically covered for Basic Life Insurance unless you elect to WAIVE enrollment. To waive coverage you must complete SF-2817, Life Insurance Election Form.

You will be enrolled in Optional Insurance (Options A, B, and C) only if you elect it. If you want to elect optional insurance coverage, you must your election for optional insurance coverage within 31 days after becoming eligible for coverage.

To waiver coverage or to elect optional insurance coverage, access the Employee Benefits Information System (EBIS). Once you are on the Human Resources Homepage, click on the Employee Access & Employment Verification link. The first EBIS link provides Log-On Information and Procedures. The Slide Show link is a PowerPoint Presentation that also contains information about EBIS and the second EBIS link takes you directly to the DoDEA's EBIS Website. If you need further assistance with making your election through EBIS, please contact your local Human Resources Representative, email the DoDEA HQ Benefits Unit at or call the Benefits Unit directly at (703)-588-3981 or DSN 425-3981.

If you waive FEGLI and at a later date wish to enroll, you must wait one year after you have waived insurance and undergo a physical at your own expense.

Remember, you must be enrolled in the Basic Life Insurance in order to enroll in any Optional Insurance.

You may turn your form into your local Human Resources Representative or Site Manager; however, your DoDEA Headquarters Benefits Unit is responsible for determining initial enrollment eligibility for both you and your family members, changes to your enrollment, establishing effective dates and for processing your FEGLI enrollment. If you are given a decision on non-eligibility to enroll or change your enrollment, you have the right to request reconsideration. When enrollment or changes to enrollment is denied, you will receive in writing the reason for denial along with instructions on how to request reconsideration.

Enrollment Changes: The amount of your Basic Life insurance will change automatically when your annual basic pay changes to a higher or lower multiple of $1,000. The new amount of insurance will be effective on the date the pay change occurs.

You may decrease the level of coverage or cancel coverage at any time. If you voluntarily cancel Basic Life insurance, all forms of Optional insurance are automatically cancelled. Employees may cancel any of the Optional insurance without affecting the Basic Life or other Optional insurance. A cancellation is effective at the end of the pay period in which a properly completed SF-2817 is received in the HR office.

Changes due to a change in marital status and/or addition of a child are permissible for Options B and C within 60 days of the event.

If at least one year has passed since you waived FEGLI coverage, you may complete SF-2822, Request for Insurance. The form is a combination request to cancel a waiver; medical certificate, and authorization for insurance. Contact your local Human Resources Representative or the DoDEA Headquarters Benefits Unit for additional information on canceling a waiver of FEGLI coverage.

Employees cannot elect Option C or increase Option C multiples by getting a physical exam after an initial waiver of this option. Employees may only elect to enroll or increase multiples to Option C based on a life event such as marriage, divorce, death of a spouse, or acquiring an eligible child.

Open Enrollment Periods: Open enrollment periods are held at the discretion of OPM and there are no regularly scheduled open enrollment periods to join or increase coverage under the FEGLI program.

Effective Dates:

For new employees Basic Life Insurance is effective on the first day you enter a pay and duty status unless you waive coverage before the end of the first pay period.

Optional coverage for employees is effective the first day they are in a pay and duty status after the day the completed election form is received by your DoDEA Headquarters Benefits Unit in the employing office or received by your local Human Resources Representative.

If you are returning to federal employment after a break in service of less than 180 days and you are eligible to enroll in the FEGLI program, you will automatically be enrolled in the same coverage that existed prior to your separation. A qualifying life event must have occurred in order to elect new coverage.

If you are returning to work after a break in service of 180 days or more and you are eligible to enroll in the FEGLI program, you are automatically enrolled in Basic and the same Optional Insurance that existed prior to your separation. However, you may elect additional insurance within 31 days of your appointment to an eligible position.

Waiver/Cancellation of Insurance:

Employees are automatically covered under Basic Insurance coverage unless they file a waiver. Basic and/or Optional insurance coverage may be canceled at any time. When Basic insurance is waived or canceled so is Optional coverage. However, Optional coverage may be canceled without canceling Basic coverage.

Beneficiary:

The Order of Precedence the Office of Federal Employees’ Group Life Insurance (OFEGLI) will pay life insurance benefits is set by law and is as follows:

  • If you assigned ownership of your life insurance by filing an assigned ownership Assignment of Life Insurance (RI 76-10), OFEGLI will pay benefits:

    First, to the beneficiary(ies) designated by your assignee(s), if any;

    Second, if there is no such beneficiary, to your assignee(s).

  • If you did not assign ownership and there is a valid court order* on file, OFEGLI will pay benefits in accordance with that court order.

  • If you did not assign ownership and there is no valid court order* on file, OFEGLI will pay benefits

    First, to the beneficiary(ies) you designated;

    Second, if there is no such beneficiary, to your widow or widower;

    Third, if none of the above, to your child or children, with the share of any deceased child distributed among descendants of that child (a court will usually have to appoint a guardian to receive payment for a minor child);

    Fourth, if none of the above, to your parents in equal shares or the entire amount to your surviving parent;

    Fifth, if none of the above, to the executor or administrator of your estate;

    Sixth, if none of the above, to your other next of kin as determined under the laws of the State where you lived.

If you want payment to be made differently than listed above, and you have not assigned your life insurance and a valid court order* is not on file, you should designate a beneficiary. To designate a beneficiary you must complete form SF 2823, Designation of Beneficiary which can be obtained from your servicing personnel representative or you may download the form from OPM’s website at http://www.opm.gov/forms/pdf_fill/sf2823.pdf. However, if you are satisfied with the order of payment listed above, you need take no action. A court-appointed guardian, or someone with your power of attorney, or other fiduciary may not designate a beneficiary for your insurance.

If there is a valid court order* on file, you may not change or submit a designation of beneficiary unless the person(s) named in the decree, order, or agreement agrees in writing or unless the decree, order or agreement is modified. You should be aware that benefits are paid based on a valid Designation regardless of whether that Designation still reflects your intentions.

Claims:

All claims for benefits will be adjudicated and paid by the Office of Federal Employees’ Group Life Insurance (OFEGLI). OFEGLI was established to process and pay claims and to perform other administrative functions needed to run the program. Benefits are payable upon submission of a claim, satisfactory proof of loss and the completion and filing of the appropriate forms.

Summary:

The decision to waive or elect life insurance should be based on your evaluation of your personal needs (including long and short term plans), family situation, and existing life insurance coverage. This is only an overview of the program; there are other features to the program such as, assignment of insurance, living benefits, requirements for continuing coverage into retirement, and conversion of insurance when life insurance terminates except by your waiver or cancellation. You may obtain detailed information or download brochures and pamphlets from OPM’s web-site at http://www.opm.gov/insure/life/76-21/PAGE1.HTM.

You may also use the FEGLI online calculator to determine the cost and benefit of various optional insurance at the following web-site: http://www.opm.gov/calculator/index.htm or you may request assistance from your local Human Resources Representative, Site Manager or DoDEA Headquarters Benefits Unit.