Facts of Life Insurance

(This article appeared in the September/October 2009 issue of The American Postal Worker magazine.)

Judy Beard, Director

The basic Federal Employee Group Life Insurance (FEGLI) that you had as a working postal employee did not automatically continue into your retirement.

The coverage you carried while employed was paid for in total by the U.S. Postal Service and had a face value of whatever your annual basic pay was, rounded to an even thousand, plus $2,000. You had a choice at retirement to continue that coverage if you (1) had the coverage for five years of service immediately before retiring, or (2) were a FERS retiree who had postponed receiving an annuity in the FEGLI program five years before your separation.

The Coverage Cost

What is basic FEGLI coverage costing you in retirement? It depends on your annual pay upon retirement, and which options you chose when you made the decision to continue to carry this insurance once you retired.

You were required to complete a lot of paperwork when you notified the Postal Service of your plans to retire. One of the forms you were required to fill out was “Continuation of Life Insurance Coverage.”

That form required you to decide whether you were going to continue your basic FEGLI coverage (the basic coverage is mandatory if you were enrolled in any of the optional life insurance programs).

You also were required to indicate on the Continuation of Coverage form whether the face value of your basic coverage was to be continued with no reduction, or would be reduced by 50 percent or 75 percent. In addition, you authorized the premium payments to be deducted from your monthly annuity.

The monthly cost is based on increments of $1,000 of Basic Life Insurance:

If you have the Additional Optional Life Insurance (such as Option A — Standard; Option B — Additional; or Option C — Family Coverage), your monthly premium will be higher than if you have just the basic coverage. And, depending on your election, these options may carry a reduction in face value.

Review Your Coverage

If you have questions about your FEGLI coverage (or don’t know where your life insurance papers are), call Customer Service at 888-767-6738 (TDD: 800-878- 5707). For changes to your life insurance coverage, you are required to write to U.S. Office of Personnel Management, Retirement Operations Center, PO Box 45, Boyers, PA 16017-0045.

Be sure to keep your beneficiary information up to date, and make sure that information about how to apply for benefits is accessible to your spouse, other beneficiaries, or executor. (The form for claims can be found at www.opm.gov/Forms/pdf_fill/fe6.pdf.) For other assistance, the number to call is 800-633-4542.

APWU Retirees Rock!

Adrian Opthof, a postal retiree who worked for many years in Red Bank, NJ, understands the importance of staying busy and making a contribution to society.

“Sometimes it’s easier to open up to a grandparent first, before mom and dad,” he says in partial explanation of why he spends so much time with Kyle, his grandson. “While reading, putting together puzzles, and enjoying each other’s company, we talk about life, and he knows I’ll always take the time to listen to him.” Clearly, the time Opthof spends with Kyle is life-enriching for both of them. (APWU membership runs in the family. Opthof ’s daughter Diane Mayer — Kyle’s mother — is a member of the New Jersey Shore Area Local.)