Questions and Answers
1. How much FEGLI coverage do I need?
It depends upon your circumstances. Generally, you need
protection most during the years you have children or other
dependents at home, and it is likely that you will want to enroll
for the maximum amount of life insurance coverage which you
believe you can afford.
2. How do the Age Multiplication Factors discussed on page 6
affect the amount of my Basic Life insurance?
If you die before you reach 36 years of age, your beneficiary
will receive your Basic Insurance Amount (BIA) plus the Extra
Benefit equal to 100% of the BIA. Thereafter, the Age
Multiplication Factor used to compute the Extra Benefit declines
by 10% each year until you reach age 45, at which time no Extra
Benefit is payable. The amount of AD&D coverage is not
affected.
There are no withholdings from your pay for this Extra
Benefit.
3. May I elect Option A, B, or C at any time?
No. As a newly eligible employee, you are automatically enrolled
in Basic Life unless you waive this coverage. You may elect any
combination of Options A, B, and C within 31 days of your
appointment without proof o insurability and regardless of your
age. However, if you decline any or all of the options, or waive
Basic Life insurance, you will have to qualify to obtain that
coverage later. See "Conditions for Changing Election"
beginning on page 10.
If you decline Option B-Additional, you will be able to elect it
later upon your marriage, divorce, your spouse's death, or
acquisition of an eligible dependent child. If you decline Option
C-Family, you will be able to elect it later upon your marriage,
divorce, acquisition of an eligible dependent child or your
spouse's death, if you have any eligible dependent children. See
page 1 1.
4. Is there any choice as to the amount of FEGLI Basic coverage I
can continue as a retiree after age 65?
There are three choices available to insured employees who are
covered under Basic Life. Employees who retire can choose No
Reduction, 50% Reduction, or 75% Reduction (see page 8).
5. Do I need to designate a beneficiary for my life
insurance?
No. If you do not designate a beneficiary, your death benefits
will be paid in accordance with the Order of Precedence provision
(see page 13).
If you wish to designate a beneficiary, you must file a
Designation of Beneficiary form (SF 2823) with your employing
office, or if you are retired, your retirement system.
If you assign your insurance coverage, you may not designate a
beneficiary. Only the assignee(s) may designate a beneficiary.
Claims for family members covered under Option CFamily are paid
to you as the insured employee in accordance with the FEGLI law;
no designations are permifted.
6. How should a claim be filed?
In the event of your death before you retire, your survivor(s)
should contact the employing office where your Official Personnel
Folder, or its equivalent, is maintained. A Claim for Death
Benefits form, FE6, and instructions will be furnished to your
survivor(s).
In the event of your death after you retire, your survivor(s)
should contact your retirement system where your retirement
records are maintained. Civil Service Retirement System (CSRS)
records are maintained by the Retirement and I nsu rance Service,
Office of Personnel Management, Retirement Operations Center,
Boyers, PA 16017. Federal Employees Retirement System (FERS)
records are maintained by the Retirement and Insurance Service,
Office of Personnel Management, FERS, PO. Box 200, Boyers,' PA
16017. In the event of your death or the death of one of your
covered family members, the name of the deceased, date of birth,
date of death and CSA (or other retirement) number should be
furnished to your retirement system.
7. May I convert my Basic Life and optional insur-
ance coverage if I terminate employment?
Yes, if you have not assigned your insurance coverage. It is your
privilege to convert the amount of your group life insurance
under Basic Life and all options to an individual conversion
(direct-pay) policy up to the amount in force at the time your
group coverage terminated. When you terminate your employment,
obtain an Agency Certification of Insurance Status form, SF 2821,
and Notice of Conversion Privilege form, SF 2819, from your
employing office and follow the instructions for conversion.
If you have assigned your insurance coverage, the
assignee(s) has (have) this privilege.
8. If I terminate my employment, do I receive a
refund of any insurance withholdings?
No. FEGLI is term insurance. There is no cash surrender or loan
value, or paid-up insurance.
9. Are part-time employees eligible for the various
types of FEGLI coverage?
Part-time employees whose appointments are not limited to a year
or less and who do not have intermittent,
appointments (that is, part-time appointments without
prearranged, regularly-scheduled tours of duty) are generally
eligible to enroll in the FEGLI Program. See page 6 for an
explanation of how to determine the annual basic pay for
insurance purposes for part-time employees.
1 0. Who can answer questions concerning my
coverage?
If you are an employee, contact the employing office where your
Official Personnel Folder (or its equivalent) is maintained.
If you are retired, contact the office administering your
retirement system.
1 1. I have a terminal illness and really could use some money
right now to pay my expenses. Can I cash in my life insurance?
FEGLI provides term insurance and technically you cannot
"cash-in" dollar-for-dollar your life insurance.
However, effective July 25, 1995, you may be eligible for living
benefits that will allow you to request a lumpsum payment of your
Basic Insurance Amount (your salary, rounded to the nearest
$1,000 plus $2,000, but no less than $1 0,000), adjusted by any
applicable Extra Benefit if you are under age 45. Employees may
elect a full lump-sum payment or only a partial payment.
Annuitants and compensationers can only elect a full lump-sum
payment and cannot elect a partial payment. See page 12 for
details.
You also have the option of assigning your life insurance
coverage to a viatical settlement firm in exchange for cash. See
page 14 for details.
12. 1 am getting divorced. The property sefflement requires that
I irrevocably designate my ex-spouse as beneficiary of my life
insurance. I thought I always have the right to change my
beneficiary whenever I wish. Are there any alternatives?
Yes, there is an alternative. Enrollees do have the right to
change their designation of beneficiary whenever they wish,
without notice to or approval of any of the existing
beneficiaries. However, you can still fulfill the requirements in
your property seftlement by irrevocably assigning your insurance
to your ex-spouse. Then, unless your ex-spouse designates someone
else, he/she becomes the beneficiary of your coverage. You can
never change nor cancel this assignment and must continue to pay
the premiums. See page 14 for details.