Basic Insurance in Retirement
If you are eligible to continue Basic life insurance into retirement, you will be able to choose from three levels of coverage for your Basic when you retire: 75%, 50%, and No Reduction. Accidental Death & Dismemberment coverage stops at retirement.
- 75% reduction — your Basic Insurance Amount will begin to reduce at age 65 or retirement, whichever is later, at the rate of 2% of the original amount per month until it reaches 25% of the Basic Insurance Amount at retirement. From then on, only 25% of the original amount of Basic insurance is payable as a death benefit.
- 50% reduction — your Basic Insurance Amount will begin to reduce at age 65 or retirement, whichever is later, at the rate of 1% of the original amount per month until it reaches 50% of your Basic Insurance Amount at retirement. From then on, only 50% of the original amount of Basic insurance is payable as a death benefit.
- No Reduction — your Basic Insurance Amount will not reduce at all after retirement.
Basic Insurance Premiums for Annuitants
All retirees pay for Basic life insurance until age 65. The premium is the same rate as that for active employees ($0.3250 monthly per $1,000). After age 65, Basic life insurance is free.
If you choose the 50% Reduction or No Reduction, you will begin to pay a premium for the extra coverage starting at retirement. This is IN ADDITION TO the Basic premium. The premium for the 50% or No Reduction election continues for life, or until you change your election or otherwise discontinue your coverage. If you choose 50% or No Reduction, you can only change to 75% reduction.
