FEGLI Life Insurance Claim

The Federal Employees Group Life Insurance (FEGLI) program is a valuable benefit for federal employees, offering life insurance coverage to those who work for the U.S. government. If you’re a federal employee or the beneficiary of a federal employee, it’s often important to understand how FEGLI works and what to do if you need to file a claim. Unfortunately, like with many life insurance claims, there can be complications or delays in receiving the benefits you’re entitled to, and understanding the process can be crucial to avoiding unnecessary setbacks.

At LifeInsuranceDenied.com, we have experience in helping individuals with life insurance disputes, including those involving FEGLI claims. Whether you are a federal employee, a retiree, or a beneficiary of a federal employee, this page provides a detailed explanation of the FEGLI program, common issues that arise in FEGLI claims, and what to do if your claim is delayed or denied.

What Is FEGLI and How Does It Work?

FEGLI is the largest group life insurance program in the world, offering coverage to federal employees, retirees, and certain family members. Administered by the U.S. Office of Personnel Management (OPM), FEGLI provides life insurance benefits to federal employees, which can be extended to their families. FEGLI offers different levels of coverage and options, allowing policyholders to tailor their insurance to their needs.

Key Features of FEGLI Coverage:

Basic Coverage: This is the default coverage for federal employees and provides a death benefit that is equal to the employee’s annual salary, rounded up to the nearest $1,000, plus an additional $2,000.
Optional Coverage: Employees can elect to add optional coverage, such as additional coverage based on their salary, coverage for family members, or additional life insurance amounts.
Life Insurance for Retirees: Retired federal employees may continue their FEGLI coverage into retirement, but the amount may be reduced after age 65.

FEGLI coverage is typically affordable, and premiums are deducted automatically from a federal employee’s paycheck. However, like other life insurance programs, issues can arise when it’s time to make a claim, particularly if there are complications regarding beneficiary designations, coverage levels, or payment issues.

Common Reasons for FEGLI Claim Denials

While FEGLI is designed to provide straightforward life insurance benefits to federal employees, claim denials can still occur. Common reasons for FEGLI claim denials include:

Failure to Update Beneficiary Information

If a federal employee dies and the beneficiary designation is outdated or unclear, it can lead to a dispute over who is entitled to the death benefit. Federal employees are encouraged to update their beneficiary information regularly, especially after significant life events such as marriage, divorce, or the birth of a child.

Example:

A federal employee designates their spouse as the beneficiary but neglects to update the beneficiary information after a divorce. The ex-spouse is still listed as the beneficiary when the employee passes away, and the insurer may deny the claim or delay payment while the issue is sorted out.

Non-Payment of Premiums

As with most life insurance policies, FEGLI requires regular premium payments to remain in effect. If premiums are not paid for a certain period, the policy may lapse, and the claim may be denied. This can happen due to payroll errors, administrative mistakes, or missed payments.

Example:

If a federal employee’s premiums are not deducted correctly from their paycheck, the coverage could lapse without the employee’s knowledge. After the employee’s death, the claim could be denied due to the policy’s lapsed status.

Eligibility Issues

FEGLI is available to active federal employees, certain retirees, and their families. However, in some cases, claims may be denied if the deceased individual was not eligible for coverage under the program. This can happen if there was a mistake in the enrollment process or if the employee was not enrolled in FEGLI at the time of death.

Example:

A federal employee retires and believes they are covered by FEGLI, only to discover that they were not enrolled in the program before their retirement. After their death, the beneficiary may be informed that the FEGLI claim is not valid due to the lack of coverage.

Pre-Existing Condition Clauses

While FEGLI does not have a traditional contestability period like many private life insurance policies, claims can still be denied if the policyholder had a pre-existing condition that would have affected their eligibility. This is particularly relevant if the employee made a material misrepresentation on their application or if the condition is excluded under the terms of their policy.

Example:

A federal employee is diagnosed with a serious medical condition and fails to disclose it when enrolling in FEGLI. After their death, the insurer may investigate the policyholder’s health history and deny the claim if they determine that the condition contributed to the death.

How to Avoid Common FEGLI Claim Issues

To prevent issues with your FEGLI claim in the future, here are some proactive steps you can take:

Regularly Update Your Beneficiary Information

Make sure to update your beneficiary information whenever there’s a significant life change, such as marriage, divorce, or the birth of a child. You can update your beneficiary designations online through the FEGLI Beneficiary Designation Form (SF 2823) or by contacting the human resources office.

Ensure Your Premiums Are Paid

If you’re an active federal employee, make sure that your premiums are being deducted properly from your paycheck. If you’re a retiree, verify that you’re still receiving FEGLI coverage and that your premiums are being paid.

Understand Your Coverage Options

Review your FEGLI coverage regularly to ensure that it still meets your needs. Make sure you understand the different coverage options, such as optional insurance, and whether your family is included as beneficiaries.

Keep Your Documents Organized

Maintain an organized record of your FEGLI policy, beneficiary designations, and premium payment history. This will help ensure that you may have the necessary documentation if you need to file a claim or if issues arise after your death.

Steps to Take If Your FEGLI Claim Is Denied

If your FEGLI claim has been denied, it’s often important to take action quickly to ensure that your rights are protected. Here are the steps you should take:

Review the Denial Letter

The first step is to carefully review the denial letter you receive from the Office of Personnel Management (OPM) or the insurer. The letter should specify the reason for the denial, whether it’s related to beneficiary issues, premium payments, or eligibility. Understanding the basis for the denial can be crucial to deciding how to proceed.

Appeal the Denial

If you believe the denial is unjustified, you may have the right to appeal the decision. The OPM provides a formal process for appealing FEGLI claims, which typically involves submitting additional documentation or evidence to support your claim.
Tips for the Appeal Process:

➤ Submit New Evidence: If new information or documentation is available, such as proof of payment or updated beneficiary forms, submit these with your appeal.
➤ Follow the Appeal Timeline: Be sure to submit your appeal within the specified time frame, usually within 30 days of receiving the denial.

Verify Beneficiary Information

If the denial is related to beneficiary issues, verify that the beneficiary designation is correct. If there’s an error or outdated information, you may need to contact OPM to correct the designation. If multiple individuals are claiming the benefit, gather supporting documents to prove your entitlement.

Consult an Attorney

If the appeal is unsuccessful or the insurer continues to deny the claim without valid justification, consulting an attorney who has experience in life insurance disputes is a good next step. An experienced attorney can:

➤ Review the specifics of your FEGLI policy and denial.
➤ Guide you through the appeals process.
➤ Represent you in court if necessary to challenge the denial.

File a Lawsuit

In some cases, taking legal action may be necessary to resolve a FEGLI claim dispute. If the insurer refuses to honor your claim after an appeal, filing a lawsuit may be the best option to secure the death benefit.

Conclusion

The FEGLI program provides valuable life insurance coverage for federal employees, but issues such as claim denials, beneficiary disputes, and eligibility challenges can complicate the process. If your FEGLI claim is denied, it’s often crucial to take immediate action to address the denial and pursue your rightful benefits. At LifeInsuranceDenied.com, our team of experienced attorneys is here to help you navigate the complexities of the FEGLI program and fight to help ensure that your family receives the death benefit they are entitled to.

Contact Us Today

If you’re dealing with a denied FEGLI claim or need assistance understanding the FEGLI program, The Law Offices of Jason Turchin is here to help. We offer free consultations and work on a contingency fee basis, meaning you won’t pay unless we win or settle your case. Call 800-337-7755 or use our live chat service to get started.