Q: I am a U.S. Postal Service employee and I will be retiring Dec. 31, under the early out option. The related annuity estimate I received as part of that offer lists the annuitant monthly premium for basic Federal Employee Group Life Insurance as $116.37. But the reference manual says I will pay “the same regular Basic premium that active employees pay,” which for postal employees is zero. There is also a chart included that says the premium would be $0.3358 for $1,000 coverage (for me, that’s about $5,4000, calculating out to about $17/month). So which of these premiums is it: $0, $17, or $116?
A: When you retire, you will pay the same premiums for Basic insurance as all other retirees. How much that will cost you depends on whether you intend to keep the full face value of your insurance on the day you retire, the 50 percent reduction, or the one that results in it declining to 25 percent beginning at age 65. In the latter case, premiums will cease when you reach 65. To see what your rates per $1,000 of coverage would be under these three options, go to http://opm.gov/insure/life/an_rates.asp.
— Reg Jones