In my last article, I offered a refresher course on Basic insurance coverage available under the Federal Employees’ Group Life Insurance program. This time I want to discuss the first and oldest of the optional insurances – Option A.
While the government has been able to secure group rates for all the insurance provided under the FEGLI program, which keeps the premiums lower, there is one big difference between Basic and all the optional insurances. Let me explain. The government pays one-third of the Basic premiums. If you elect any of the optional forms of coverage, you will be responsible for paying 100 percent of the premiums.
Option A, called Standard Optional, allows any employee who is covered under Basic insurance to purchase an additional $10,000 of coverage. The premiums vary by age, beginning at $0.30 bi-weekly per $1,000 of coverage and ending at $6.00 per $1,000 biweekly if you are 60 or older. The monthly rates are $0.65 per $1,000 up to $13.00. If you are retired and 65 or older, you don’t have to pay any premiums; however, your coverage will decline by 2 percent per month until it reaches 25 percent of its face value.
While Option A coverage isn’t for everybody, it may be a good choice for those of you who need it in the short-term to provide additional money for your family, should you die while your Basic coverage amount is low and/or your debts high. Just remember, it can always be cancelled if you no longer feel a need for it, unless you have assigned the benefit to someone else. I’ll talk about that in a future article.
Unlike Basic insurance, enrollment in Option A isn’t automatic. You’ll have to submit a completed Standard Form 2817, Life Insurance Election, to your personnel office within 31 days of your appointment to a position that provides for FEGLI coverage. You can get a copy from your personnel office or download a copy at
www.opm.gov, click on Forms.