Frequently Asked Questions Retirement

You can cancel or decrease your coverage at any time. You cannot increase your coverage.

If you are in good health and you retire for reasons other than disability, you may elect to provide a survivor annuity to someone with an insurable interest. You can elect to provide an insurable interest benefit and the maximum benefit for a spouse or an ex-spouse. Spousal consent is not required. However, if you are married and elect an insurable interest benefit for your spouse, spousal consent is required.

If you elect an insurable interest benefit, you are responsible for arranging for and paying the cost of any medical examination required to show you are in good health. A report of the medical examination should be included with your retirement application.

You can elect to provide an insurable interest annuity only for someone who has an insurable interest in you. "Insurable interest" is an insurance term which applies to someone who would reasonably expect to derive financial benefit from your continued life. For survivor benefit election purposes, an insurable interest is presumed to exist if you name as beneficiary of the insurable interest, any of the following individuals:

• a spouse;
• a blood or adopted relative closer than first cousins;
• an ex-spouse;
• a person to whom you are engaged to be married; or
• a person with whom you are living in a relationship that would constitute a common-law marriage in a jurisdiction that recognizes common-law marriages.

If the person named is not one of the above, you should submit affidavits with your retirement application from one or more people with knowledge of the individual's insurable interest. The affidavits should state:

• the relationship between you;
• the extent to which the person named is dependent on you;
• the reasons why the person named might reasonably expect to derive financial benefit from your continued life.

The reduction to provide an insurable interest benefit is computed as follows:

• If the person named is older, the same age, or less than 5 years younger than the retiree, the reduction is 10 percent;
• If the person named is 5 but less than 10 years younger than the retiree, the reduction is 15 percent;
• If the person named is 10 but less than 15 years younger than the retiree, the reduction is 20 percent;
• If the person named is 15 but less than 20 years younger than the retiree, the reduction is 25 percent;
• If the person named is 20 but less than 25 years younger than the retiree, the reduction is 30 percent;
• If the person named is 25 but less than 30 years younger than the retiree, the reduction is 35 percent; or
• If the person named is 30 or more years younger than the retiree, the reduction is 40 percent.

The insurable interest automatically ends if the insurable interest dies, if you marry the insurable interest and elect to provide a spousal benefit, or if the named person is your spouse and you change your election to provide a spousal survivor benefit.

If you were under 62 when your disability benefit began, and were not eligible for a voluntary immediate benefit, your benefit will be recomputed after you have been retired for 12 months. The recomputed annuity will be 40 percent of your high-3 average salary minus 60 percent of your monthly Social Security benefit, or your earned benefit, whichever is higher.

At age 62, your benefit is recomputed as though you had continued working until age 62. (Your average salary is increased by all FERS Cost-of-Living Adjustments paid while you were disabled.)

Contact your agency’s Benefits Officer.  A complete list of Benefits Officers by agency can be found at http://apps.opm.gov/abo/.

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act was passed by the United States Congress on December 16, 2010 and signed into law on December 17, 2010. As a result, the IRS published the tax withholding tables later than usual for 2011. OPM applied the tax tables as quickly as possible but there was not enough time to apply these tables to the January 3, 2011 annuity payments.

We keep a separate mailing address to periodically send you information about your retirement and health and life insurance benefits. You can see the current record of your mailing address on Services Online. Please notify us if this address changes.

(If you do not receive your payments through direct deposit, we ordinarily use the same address for mailings and payments.)

If you contributed to the Federal Employees Retirement System (FERS), you will get interest on the refund of those contributions if you worked more than one year. Interest is paid at the same rate that is paid for government securities. See the variable interest rates.

If you contributed to the Civil Service Retirement System (CSRS) while you worked, interest will be included in the refund of those contributions if you have more than one but less than five years of service. Interest is paid at three percent.

The withholding changes affect the February 1, 2011 payment and subsequent annuity payments.