If you are a federal employee, you may be enrolled by Option B or C coverage under the Federal Employees’ Group Life Insurance program. If you are a retiree, some of you have retained that coverage. And most retirees still have their Basic insurance. If so, I have some news for you. Some of the premium amounts are changing. For employees, those changes will be reflected in their first pay check earned during January 2012; for retirees, in their February annuity payment.
OPM has completed a study of the FEGLI program. Based on this updated actuarial analysis of actual claims experience, OPM has determined that premium changes need to be made to Option B, Option C and post-retirement Basic. These changes are based on funding and claims experience within the FEGLI program and reflect updated mortality and claims rates from actual program experience within each category.
As a result, premiums for all Option B age bands, other than the oldest groups (ages 75-79 and ages 80 and over) will decrease. Premiums for Option C age bands under age 45 will also decrease. However, a rate increase is needed for Option C premiums for those ages 45 and over. Premiums for post-retirement Basic FEGLI will also increase slightly for those enrollees who elect the 50% Reduction and No Reduction. According to OPM, “These increases are necessary due to the experience of the group and are necessary to sufficiently fund the projected future increases.”
The complete set of 2012 premium rates for Option B, C and retiree Basic insurance are shown below.
Option B Premium per $1,000 of Insurance
Age Band Biweekly Monthly
Under 35 $0.02 $0.043
35–39 $0.03 $0.065
40–44 $0.05 $0.108
45–49 $0.08 $0.173
50–54 $0.13 $0.282
55–59 $0.23 $0.498
60–64 $0.52 $1.127
65-69 $0.62 $1.343
70-74 $1.14 $2.470
75-79 $1.80 $3.900
80 and over $2.40 $5.200
Option C Premium per Multiple of Insurance
Age Band Biweekly Monthly
Under 35 $0.22 $0.48
35–39 $0.29 $0.63
40–44 $0.42 $0.91
45–49 $0.63 $1.37
50–54 $0.94 $2.04
55–59 $1.52 $3.29
60–64 $2.70 $5.85
65-69 $3.14 $6.80
70-74 $3.60 $7.80
75-79 $4.80 $10.40
80 and over $6.60 $14.30
Annuitant Basic Premium per $1,000 of Insurance
Election Monthly withholding for Monthly withholding for
each $1,000 of your BIA each $1,000 of your BIA
before age 65 after age 65
75% Reduction $0.3250 No cost
50% Reduction $0.9650 $0.64
No Reduction $2.2650 $1.94
To compare these rates with the ones in effect in 2011, go to www.opm.gov/insure/life/rates/em-rates.asp (for employees) and www.opm.gov/insure/life/rates/an-rates.asp