Browsing: LIFE INSURANCE

Q. I turned 65 and am not paying premiums on basic life insurance as I selected the 75 percent reduction. My life insurance was $54,000. What is it now worth, and how do you calculate what it will be worth once I reach the 25 percent? A. Because you accepted the 75 percent reduction, the value of your insurance will decline by 2 percent each month until it reaches 25 percent of what it was when you retired. At that point, your $54,000 basic insurance will be worth $13,500.

Q. My dad retired from working as janitor at the post office. Recently, we have discovered he has not been paying any insurance. He has been diagnosed with Alzheimer’s. Is there a retiree life insurance policy? A. You’ll have to call the Office of Personnel Management’s Retirement Information Office at 1-888-767-6738 to find out what coverage your father took into retirement. You’ll need to provide the specialist with his full name, date of birth, Social Security number and CSA number. You’ll find the latter on any copy of the 1099-R form he used to file his federal income tax.

Q. I’m retiring from the Postal Service soon and have come to the stumbling block of getting the survivor benefit plan or forgoing it for a form of life insurance (whole or permanent). I’m a CSRS 56-year-old male with a 44-year-old wife who works as a teacher. I have been under her medical plan, not the Federal Employees Health Benefits plan, for the past five years. SBP would cost me $271 a month. Taking a 30-year term life policy would mean I’d better die within that time or I screwed my wife out of what I consider her entitlement to my retirement.…

Q. My retirement eligibility service computation date is June 6, 1985. I’m under FERS and am 48 years old.  I’d like to take the Voluntary Early Retirement Authority this year if offered. If I retire at 48 under VERA and I postpone my FERS annuity until age 56 (my normal minimum retirement age), will the annuity amount be the same as it would have been if I actually retired at 56 rather than 48, or is it reduced? Is this amount changed if I take the FERS annuity at 56 rather than 48?  If I postpone FERS annuity, will the…

Q. My father was a retired (1979) federal employee receiving monthly retirement payments via direct deposit. He died last week. 1. What do I need to do? 2. Who do I notify to stop his monthly retired pay and to initiate the process for obtaining his government life insurance? A. You need to call the Office of Personnel Management’s Retirement Information Office at 888-767-6738. Make sure to have your father’s full name, Social Security number, date of birth and Civil Service Annuity number at hand when you do that. The benefits specialist will send you the paperwork you need to…

Q. My sister has been on leave without pay with the Postal Service for over three years and is receiving payments from the Office of Workers’ Compensation Programs due to a work-related injury incurred some years back. Recently, she received a bill for her life insurance for $400 a month. It has been our understanding that she would pay her portion for health insurance only, and that life insurance is covered under workers’ comp. Please advise. A. You are only partly right. For the full story, go to www.opm.gov/insure/life/faq/faqs-5.asp and scroll down through the Q&As.

Q. I am considering taking a State Department full-time temporary excepted appointment NTE 13 months with no re-employment benefits. I am a career-status employee with the federal government. State requires a four-day break between my current position and beginning service with them. How does this affect my retirement benefits and my career status? Will I not be considered career status when I apply for new jobs after my temporary position comes to an end? A. When you separate from the government, if you are covered by the Federal Employees Health Benefits and/or Federal Employees Group Life Insurance programs, you will…

Q. I elected the 75 percent reduction after retiring. I understand that, at age 65, the coverage declines 2 percent per month until it reaches 25 percent of its face value. How can I find out what the “face value” is? Is it the salary at retirement? What if I had the 2X salary? Does that have any bearing? I have been told by some retirees that the final amount is $2,000, and by others that it’s anywhere from $8,000 to $10,000. A. When you retired, the amount of your basic insurance was equal to your basic pay plus $2,000. Since you…

Q. I  have a service-connected disability and will be retiring soon under  CSRS. Would my wife receive money from my service-connected disability and from my civil service with a survivor annuity of 75 percent? A. If you elected a full survivor annuity for her, she would receive 55 percent of  the amount of your annuity before it was reduced to provide for that annuity, increased by any subsequent cost-of-living adjustments that you received after you retired. She would also receive the proceeds of your Federal Employees’ Group Life Insurance. Because this is a site dedicated to answering civilian benefit questions, I don’t…

Q.  If I choose no reduction for Basic, can I change my multiples in option B to reduce coverage at any time during retirement?  I would like to lower by one multiplier at each five-year interval beginning with five at age 55. A. According to OPM, “Unless you have assigned your insurance, you may cancel it at any time. If you cancel your Basic life insurance, you are canceling all your Optional insurance as well. If you elected 50 percent or No Reduction for your Basic life insurance, you may cancel this additional coverage at any time. If you have…