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Life insurance for federal employees

FEGLI gives most federal employees automatic Basic coverage and optional A, B and C. How the options work, what they cost, and when private term may fit better.

4LifeInsurance · Published October 4, 2026

Most federal employees are automatically covered by Basic life insurance under the Federal Employees' Group Life Insurance program (Federal Employees' Group Life Insurance (FEGLI): Basic, A, B and C) unless they decline it, and can add three kinds of Optional coverage: Standard (Option A), Additional (Option B) and Family (Option C). Basic is cheap because the government pays a third of the cost; the options are priced by age and get expensive in your 50s and 60s. Many employees use FEGLI for a base layer and compare Option B with private term insurance.

What FEGLI offers

The U.S. Office of Personnel Management (OPM) administers the program. According to OPM's FEGLI overview, FEGLI is group term insurance, so it builds no cash value or paid-up value, and the enrollee pays two-thirds of the Basic cost with the government paying the rest. The pieces are:

  • Basic. Automatic for new eligible employees. The Basic Insurance Amount is your annual pay, rounded up to the next $1,000, plus $2,000. Enrollees age 35 or younger also get the Extra Benefit, which doubles the Basic amount at no extra cost; it shrinks by 10% a year from age 36 and is gone after 45, according to OPM.
  • Option A (Standard). A flat $10,000 of additional coverage.
  • Option B (Additional). One to five times your annual pay, in whole multiples.
  • Option C (Family). Up to five multiples for a spouse (each multiple is $5,000) and for children (each multiple is $2,500 per eligible child).

Basic is automatic. Optional coverage is not: you must elect it, and you need Basic to hold any option. Details of eligibility, accidental death benefits and claims are in Federal Employees' Group Life Insurance (FEGLI): Basic, A, B and C.

What it costs

OPM's premium table for employees (effective on the first pay period starting on or after October 1, 2021; rates may change) lists these monthly figures:

Coverage Rate
Basic, all ages (employee share) $0.3467 per $1,000 of Basic coverage
Option A, under 35 / 45-49 / 60+ $0.43 / $1.30 / $13.00 for the $10,000
Option B, under 35 $0.043 per $1,000
Option B, 45-49 $0.130 per $1,000
Option B, 55-59 $0.390 per $1,000
Option B, 60-64 $0.867 per $1,000

Check OPM's current premium page before you decide, since it states rates can change.

Hypothetical example

Say a 45-year-old with an $80,000 salary has a Basic Insurance Amount of $82,000 and has no Extra Benefit at that age. Basic costs about $28.43 a month ($82 x $0.3467). Adding Option A ($1.30) and Option B at five times pay, $400,000, at $0.130 per $1,000 adds about $52 a month. Total coverage is about $492,000 for roughly $82 a month. At 60, the same Option B coverage would cost about $347 a month at $0.867 per $1,000, which is why many people review Option B as they age. These are arithmetic from OPM's published rates, not quotes for any individual.

FEGLI vs private term insurance

FEGLI Option B is priced by age bands that step up every five years, while a private level term policy keeps the same premium for 20 or 30 years. So the usual comparison looks like this:

  • Early career: Option B is usually cheap and convenient. Payroll deduction, no medical exam when you elect it during the first 60 days after appointment to an eligible position (after that, enrollment opportunities are limited), and it keeps going during job changes within federal service.
  • Mid-career: if you are healthy, a level term policy locked in at 35 or 40 may cost less over the next 20 years than Option B's stepped rates. If you have health issues, Option B during an open season or after a qualifying life event, without or with limited medical evidence, may be the better path.
  • Near retirement: FEGLI can continue into retirement. Retirees choose how much Basic coverage is reduced after age 65: a 75% reduction leaves coverage that is free after the month following the 65th birthday, according to OPM, while less reduction costs more. Option B has its own continuation rules.

OPM says open seasons are infrequent, so you cannot count on adding coverage whenever you want; changes outside an open season generally need medical information or a qualifying life event. That limitation is a real reason to consider buying private term earlier rather than relying on adding Option B later.

Gaps to check

  1. Family needs. A spouse with Option C, $25,000 at the maximum, will not replace much; compare against what the How much life insurance do I need? says you need.
  2. Portability. FEGLI follows you to federal retirement, but if you leave federal service before retirement, it usually ends, with a conversion right to an individual policy that is typically expensive. keeping group life insurance when you leave a job explains why conversions cost more.
  3. Survivor income. Your family may also qualify for benefits through your federal retirement system and Social Security; see Social Security survivor benefits and the $255 death payment and ask your agency HR office about the retirement side.
  4. Beneficiary designation. FEGLI follows its own order of precedence if you name no beneficiary. File the designation form with your agency and keep it current.

A step-by-step approach

  1. Check your pay stub or your agency HR portal for what you now carry.
  2. Use the OPM FEGLI calculator to see the cost of each option.
  3. Estimate your need with the How much life insurance do I need?.
  4. Compare Option B with a private level term quote at your age.
  5. Decide: keep Basic, add or drop options, or layer private term. Open season or new-hire windows may be your only easy chance to add.

Key takeaways

  • Basic FEGLI is automatic, subsidized by the government and based on pay plus $2,000; Optional A, B and C must be elected.
  • Option B is cheap when you are young and costly after about 55; compare it with level private term at your age.
  • Chances to add FEGLI coverage later are limited, so decide early.
  • FEGLI can continue into retirement; leaving federal service early usually ends it with only a conversion option.
  • Check current premiums on OPM.gov, since rates may change.

Terms used in this guide

Group life insurance Coverage issued under one master contract to members of a group, usually employees, often at one or two times salary with little or no underwriting. Term life insurance Life coverage for a set number of years, such as 10, 20 or 30, that pays a death benefit only if the insured dies within that period. Conversion privilege A term policy feature that lets the owner switch to permanent coverage with the same insurer without new medical underwriting, within set deadlines. Voluntary life insurance Group life coverage offered through an employer that employees choose to buy and pay for themselves, usually by payroll deduction. Accidental death and dismemberment (AD&D) Coverage that pays only when an accident causes death or the loss of a limb, sight, speech or hearing; illness and most natural causes are not covered. Beneficiary The person, trust, charity or estate named to receive a life insurance death benefit or an annuity's remaining value when the insured or owner dies.

Related tools

How much life insurance do I need? Add up income replacement, debts, college and final costs, subtract what you already have, and see how much coverage is left to buy. Is my life insurance through work enough? Compares your workplace life insurance and personal policies with what your family needs, and shows what would remain if you left your job.

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