The Federal Government is this country’s largest (non-private) employer. There are millions and millions of full-time and half that again for part-time workers. These people include our men and women in the armed forces, postal employees, IRS workers, politicians, retirees from all these organizations, etc. Federal employees automatically get basic life insurance, which is self-insured by the Government and called FEDERAL EMPLOYEES GROUP LIFE INSURANCE (FEGLI). This basic coverage is typically a minimal amount, often equal to one year’s annual pay. Federal employees also have the option, at times, to obtain more insurance referred to as “optional” Insurance. This optional insurance comes in multiples of the Basic amount and employees have the ability to choose how many multiples, up to 5, of their salary they wish to be insured for at the low group rates. When someone separates or retires from service, they are given 31 days to decide if they want to take their life insurance with them or not. By taking control of your own life insurance coverage and planning ahead, you gain future options that won’t otherwise exist. One example is that IF you should get seriously ill, you will have options to convert that policy to cash by way of a viatical settlement. It’s most important that you understand what to do in order to maximize your benefit. I am typically able to ascertain during an initial phone call, what steps need to be taken to derive the most beneficial options going forward.* The first thing to understand is that the way the FEGLI Rules are written, it can be beneficial to split the life insurance...
