Brief Guide to FEGLI Benefit Recipients
Did you know that unassigned life insurance benefits follow a specific order to determine who receives them? Whether Basic, Option A, or Option B, FEGLI insurance follows the order below.
Beneficiary – somebody you designate before death.
Widow/widower – a partner under law.
Children – They will share the amount equally. If a child has passed away, their own children will split the amount.
Parents – If one has died, the remaining parent will receive the full amount.
Administrator or Executor of State – If one has been appointed, this will be the fifth option.
Next of Kin – If none of the first five exist, the money will be given to the next of kin at the time of your death.
Depending on your needs, it’s possible to name several beneficiaries. If one dies before yourself, their share will be split equally between the remaining beneficiaries. If only one survives, they will receive the full amount.
What if no beneficiaries survive? This does happen, and the receipt of the money will follow the order above.
Considered an ‘order of precedence,’ it will apply to most cases. However, a court may issue a decree of annulment, legal separation, or divorce and this will supersede the order. In these cases, it may be decided that the benefits are paid to another party. For this to apply, the government must have the decree on file before the insured individual passes away.
When a decree affects retirees, remember to send these to the Office of Personnel Management (OPM). Furthermore, the assignment needs to be made official, and this can be done by completing the Assignment of Life Insurance form (RI76-10).
As a side note, you will be the beneficiary if option C-Family insurance has been installed. Under law, you won’t be able to designate a beneficiary, so you’ll receive the money as a lump sum. In rare circumstances, an individual can outlive an insured family member before then dying while the payment is being processed. If this were to occur in your situation, the person who receives your Basic life insurance benefits would receive this payment instead.
Conclusion
If you don’t want any problems after you pass away, remember to designate a beneficiary for your FEGLI insurance. That’s how you can be sure that they receive the benefits before somebody else in the order of precedence.
