United StatesOffice of
Personnel Management
The Federal Government's Human Resources Agency
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| Subject: | Federal Employees' Group Life Insurance: New Premiums and Age Bands |
The purpose of this Letter is to provide important changes to FEGLI Option B and C age bands and to withholdings and contributions rates. All the changes discussed in the Letter are effective with the first day of the first pay period in calendar year 2003.
NEW AGE BANDS
Agency payroll offices must add new age bands for Option B and C coverage:
For Option B, the following age bands must be added:
| Current | New |
|---|---|
| 60 and above | 60-64 |
| 65-69 | |
| 70-74 | |
| 75-79 | |
| 80 and over |
For Option C, the following age bands must be added:
| Current | New |
|---|---|
| 70 and above | 70-74 |
| 75-79 | |
| 80 and over |
NEW WITHHOLDINGS AND CONTRIBUTIONS
Basic Life Insurance.
For employees, the new withholding and contribution rates are, as follows:
| Per $1,000 of coverage | ||
|---|---|---|
| Biweekly | Monthly | |
| Withholdings | 0.1500 | 0.3250 |
| Contributions | 0.0750 | 0.1625 |
For retirees, the monthly withholding rates for 50% Reduction and No Reduction Basic life insurance coverage will change, as follows:
| Election |
Withholding Rate [$ per $1,000 of coverage] |
||
|---|---|---|---|
| Before age 65 |
First month after age 65 |
||
| No change | 75 percent reduction | .3250 | Free |
| New rate | 50 percent reduction |
.9250 [.3250+.60] | .60 |
| New Rate | No reduction |
2.1550 [.3250+1.83] | 1.83 |
Option A. There will be no changes to Option A withholding rates.
Option B. Withholding rates for Option B will be as follows:
| Age Band |
Withholding Rate [$ per $1,000 of coverage] |
||
|---|---|---|---|
| Biweekly | Monthly | ||
| No change | Under 35 | 0.03 | 0.065 |
| No change | 35-39 | 0.04 | 0.087 |
| No change | 40-44 | 0.06 | 0.130 |
| New rate | 45-49 | 0.09 | 0.195 |
| New rate | 50-54 | 0.14 | 0.303 |
| New rate | 55-59 | 0.28 | 0.607 |
| New band | 60-64 | 0.60 | 1.300 |
| New band | 65-69 | 0.71 | 1.538 |
| New band | 70-74 | 0.87 | 1.885 |
| New band | 75-79 | 1.07 | 2.318 |
| New band | 80 and over | 1.27 | 2.752 |
We will issue BALs in the fall of 2003 and 2004 to announce the employee withholdings for these new age bands for 2004 and 2005, respectively.
Option C. Withholding rates for Option C will be as follows:
| Age Band | Withholding Rate [$ per multiple] | ||
|---|---|---|---|
| Biweekly | Monthly | ||
| No change | Under 35 | 0.27 | 0.59 |
| No change | 35-39 | 0.34 | 0.74 |
| No change | 40-44 | 0.46 | 1.00 |
| No change | 45-49 | 0.60 | 1.30 |
| No change | 50-54 | 0.90 | 1.95 |
| No change | 55-59 | 1.45 | 3.14 |
| No change | 60-64 | 2.60 | 5.63 |
| No change | 65-69 | 3.00 | 6.50 |
| New band | 70-74 | 3.40 | 7.37 |
| New band | 75-79 | 4.50 | 9.75 |
| New band | 80 and over | 6.00 | 13.00 |
Note above that there will be no changes to the withholding rates for any existing age bands.
This BAL is being issued in conjunction with BAL 02-209 dated September 25, 2002.
If you have any questions about the matters discussed in this letter, we would prefer that you email them to us at finance@opm.gov, so that we may retain a record of them. You may also call us on (202) 606-0606.
|
Robert A. Yuran, Chief Financial Policy Staff |
Download the Letter as a PDF File