Life insurance premium changes on the way for some feds
Affected employees and retirees will see decreases or increases depending on their plans.
The Office of Personnel Management announced Thursday new premium rates for some federal workers and retirees enrolled in the government's group life insurance program.
Some premiums are going down, while others are increasing beginning the first pay period on or after Jan. 1, 2012. The changes affect enrollees in Option B, Option C and those who have post-retirement basic insurance. Premiums for federal employees who have basic insurance under the Federal Employees' Group Life Insurance Program or Option A coverage will not change.
Premiums for all Option B age bands, except the age 75-79 band and the age 80 and over category, will decrease. Premiums for Option C age bands under age 45 also will decrease. A rate increase will hit those Option C age bands 45 and older. Premiums also will increase slightly for Post-Retirement Basic FEGLI enrollees who choose 50 percent reduction and no reduction.
"These increases are necessary due to the experience of the group and are necessary to sufficiently fund the projected future increases," said the notice in the Federal Register, which will be published officially on Nov. 14.
All FEGLI enrollees receive basic insurance, which includes coverage totaling the employee's annual pay, rounded to the nearest $1,000, plus an additional $2,000. Enrollees also can elect additional plans. Option A provides $10,000 of coverage, while Option B is available in multiples of annual pay. Option C covers spouses and dependent children. Option C premiums are based on the age of the federal employee, not the age of any eligible family members. Employees pay two-thirds of the insurance costs, while the government picks up one-third of the tab.
The new biweekly premium rate for enrollees in Option B ranges from 1 cent to 10 cents less than the current rate. For example, an Option B enrollee in the age 40-44 category who now is paying 9 cents every two weeks will pay 8 cents every two weeks beginning in January. In the Option C category, the increases range from 7 cents to 60 cents every two weeks. Click here for a complete list of rate changes.
According to OPM, the last premium change for the affected age categories in Options B and C and post-retirement basic insurance was in 2003.