Q: I am 57 years old and plan to retire in two years. I have basic Federal Employees Group Life Insurance plus two times optional coverage. My total annual premium is nearly $1,900 for roughly $400,000 of insurance. Equivalent coverage in the open market is considerably cheaper. Is there any advantage to retaining my FEGLI coverage as I approach retirement?
A: The major benefit, assuming that you are insurable at more attractive rates on the retail market, is that if you retire with basic FEGLI coverage, you can, once you reach age 65, retain 25 percent of that coverage, at no charge, for life.