FEGLI Coverage

The Federal Employees Group Life Insurance covers most federal employees. Most employees elect this coverage when they are hired on, and others take advantage of open enrollment periods that have become more and more infrequent. In either case, it is important you understand how this program works and how to get the most out of your hard earned dollars.

What most People Don’t Realize About FEGLI

The reason federal employees do not think much about their FEGLI coverage is because it is taken out of their paycheck usually from day one of employment. If you are young- it makes sense that you would not notice $5- $8 a paycheck. When you are young, FEGLI offers substantial coverage for very affordable bi-weekly premiums. Through coverage “B” you can take up to 5 times your base salary and brings most people between $250,000 to $350,000 of life insurance.

The problems arise later in your career with the federal government. That same insurance that cost you $5-$8 a pay period can cost you as much as $171/pay period between 55 and 60 years of age.

Most people by that time they have to live on a retirement check and end up dropping the coverage. The most unfortunate aspect of this situation is the employee if they were hired on at age 35 have given the government over $31,000 in premiums through out their career and when they drop the coverage in later years they have nothing to show for it.

That same amount of premium in the private sector in some cases will provide more coverage and will allow the employee to accumulate cash value that can end up supplementing retirement if they do not use the death benefit.

If you want to be sure you are getting the most out of your hard earned money, please contact us and we can arrange for a specialist to provide an in-depth analysis.