United States 

Office of 

Personnel Management 

The Federal Government’s Human Resources Agency

Benefits Administration Letter

Number: 14-208 Date: October 7, 2014

Subject: Phased Retirement and Federal Employees’ Group Life Insurance (FEGLI) 

Program Guidelines

Background

On August 8, 2014, the Office of Personnel Management (OPM) issued the final regulation to 

implement phased retirement pursuant to section 100121 of the “Moving Ahead for Progress in 

the 21st Century Act,” or “MAP-21,” Public Law 112-141. This law authorized changes to the 

Civil Service Retirement System (CSRS) and the Federal Employees’ Retirement System (FERS) 

by amending title 5, United States Code, to include sections 8336a and 8412a. 

Phased retirement is a new human resources tool that allows full-time employees to work a parttime schedule while beginning to draw partial retirement benefits. The purpose of this letter is to 

provide guidance to Federal agencies seeking to implement the new phased retirement program as 

it pertains to the Federal Employees’ Group Life Insurance (FEGLI) Program. 

Federal Employees’ Group Life Insurance Coverage for CSRS and FERS 

A phased retiree is deemed to be a full-time employee for the purpose of the FEGLI Program, and 

the FEGLI withholding and employer contribution will be the same as for full-time employees. 

The amount of Basic and Optional coverage is based on the law and regulations at 5 U.S.C. 

chapter 87 and 5 C.F.R. part 870, respectively, and coverage (including applicable accidental 

death and dismemberment coverage) is the same as the benefit amounts for full-time employees. 

Transition to Phased Retirement 

An employee who enters phased retirement will not be eligible to change his or her FEGLI 

coverage based on entry into phased retirement status as phased retirement is not a change in 

family circumstances that will allow an employee to cancel a waiver of Basic or Optional 

insurance. Similarly, individuals who change agencies or duty stations during phased retirement 

will maintain their current enrollment unless they are otherwise eligible to make changes. 

Eligible phased retirees, however, will be able to elect enrollment changes in accordance with 

existing FEGLI law and regulation. 

During phased retirement, an employee’s FEGLI enrollment will stay with the employing agency, 

and all FEGLI premiums will be withheld from the employee’s salary. FEGLI premiums will not 

be withheld from an individual’s annuity until full retirement. If, at the time of full retirement, 
the employee meets the participation requirements to continue FEGLI during retirement, his or 

her FEGLI enrollment will transfer to OPM. 

There is no change in FEGLI rules concerning the dates that coverage begins, terminates, or 

cancels. Also, conversion and assignment of Basic insurance and Optional insurance is the same 

as for full-time employees under 5 U.S.C. chapter 87 and part 5 C.F.R. part 870. 

During phased retirement, FEGLI claims are paid in accordance with existing law and regulation. 

The same payment options are available to phased retirees as are available to full-time 

employees. For additional information on payment options, please refer to the 2014 FEGLI 

Handbook subchapter entitled “Payment of Claims.”

Transition from Phased Retirement to Full-Time Employment 

After entering phased retirement, a phased retiree can end his or her phased retirement to return to 

being a regular full-time employee, if the employing agency agrees to the change. The phased 

retirement annuity will then terminate. Once an individual has gone back to being a full-time 

employee, the individual cannot elect to go back into phased retirement. 

No additional forms need to be completed or submitted to maintain the existing FEGLI coverage. 

Returning to regular full-time employment after phased retirement is not a change in family 

circumstances that will allow an employee to cancel a waiver of Basic or Optional insurance. 

The employee will not be eligible to change his or her FEGLI coverage unless the return to fulltime service is during a FEGLI open season or the change is otherwise permitted by law or 

regulation. Similarly, individuals who change agencies or duty stations will maintain their 

current enrollment unless they are authorized by law or regulation to make changes. 

Transition from Phased Retirement to Part-Time Employment 

A phased retiree may end his or her phased retirement to become a part-time career employee as 

defined by Federal law and regulation, if the employing agency agrees to the change. The phased 

retirement annuity will then terminate. Once an individual has become a regular part-time 

employee, the individual cannot elect to go back into phased retirement. 

An employee who ends his or her phased retirement to become a part-time career employee must 

pay the applicable enrollee share of the FEGLI premium as required by Federal law and 

regulation. No additional FEGLI forms need to be completed or submitted to maintain the 

existing FEGLI coverage. A phased retiree who ends his or her phased retirement to become a 

part-time career employee will be able to make enrollment changes in accordance with existing 

FEGLI law and regulation. 

If the employee becomes a part-time career employee the change will affect both the amount of 

the employee’s coverage (the basic insurance amount) and the amount of premiums for Basic 

insurance. For current Basic premiums, you may refer to the 2014 FEGLI Handbook chapter 

entitled “Withholdings For Basic Insurance” at: http://www.opm.gov/healthcare-insurance/lifeinsurance/reference-materials/publications-forms/fegli-handbook/. 

Transition from Phased Retirement to Full Retirement 

A phased retiree may voluntarily apply for full retirement in the same manner as other employees. 

The employee does not have to obtain the permission of his or her agency to fully retire. If a 
phased retiree elects full retirement, his or her FEGLI coverage continues unless it is cancelled or 

terminated in accordance with existing law and regulation. 

Phased retirement is creditable toward the 5 years of service needed to continue FEGLI coverage 

as an annuitant. In the event an employee ends his or her phased retirement for full retirement, 

FEGLI coverage will continue if the employee meets all eligibility requirements. 

Death in Service During Phased Retirement 

If a phased retiree dies in service while enrolled in FEGLI, you must provide the SF 2821 and 

designations (if on file) when certifying FEGLI coverage. Also, please provide all other FEGLIrelated file documents with the certification of FEGLI coverage. If documents do not exist or are 

otherwise difficult to obtain, you may provide a copy of the separation SF 50 “Notification of 

Personnel Action”. 

As is the current procedure, we require two signatures from authorized agency officials on the SF 

2821, one with access to personnel records, and the other with access to payroll records. This 

requirement reduces the possibility of an incorrect certification and helps to verify that the payroll 

and personnel offices have maintained the same level of coverage for the employee. Also, please 

show the full-time basic pay rate as the annual basic pay on the SF2821. 

You must send the duplicate (Part 2) SF2821 to the Office of Federal Employees’ Group Life 

Insurance (OFEGLI). Keep the original and attach it to the Claim for Death Benefits (Form FE-6) 

when received. If no claim for death benefits is received, send the original (Part 1) SF 2821, upon 

request, to OFEGLI. 

For FEGLI claims and regular mail, the new OFEGLI mail processing address (effective April 1, 

2014) is: OFEGLI P.O. BOX 6080 SCRANTON, PA 18505-6080; for overnight deliveries only 

(such as express mail), the new OFEGLI mailing address is: OFEGLI 123 WYOMING AVE., 

3RD FLOOR SCRANTON, PA 18503.

Employees Who Separate From Federal Service During Phased Retirement 

The Basic insurance and Optional insurance of a phased retiree stop at the time the employee 

separates from service. The employee is entitled to a 31-day extension of coverage, and, if the 

insurance terminates for any reason other than voluntary cancellation, the employee may apply to 

convert all or any part of his or her Basic and Optional insurance to an individual policy. 

You must notify the employee/assignee(s) of the loss of coverage and the right to convert to an 

individual policy either before or immediately after the event causing the loss of coverage. You 

must issue to the employee the SF 2821 and SF 2819 “Notice of Conversion Privilege.”

If an employee is eligible to continue coverage as an annuitant, give the employee the SF 2818 

“Continuation of Life Insurance As an Annuitant or Compensationer” to complete. Send all the 

paperwork to the OPM Retirement Office. 

If the employee is not eligible to continue coverage, the coverage ends at the time the employee 

separates from service with 31 days free coverage and the right to convert. You must give the 

employee an SF 2819 and SF 2821, so that he/she has the opportunity to convert the FEGLI 

coverage. 
Other Benefits Programs 

The statutory authority for phased retirement and OPM’s final rule do not pertain to other benefits

programs for which Federal employees and certain individuals are eligible. These programs 

include the Federal Employees Dental and Vision Program (FEDVIP), Flexible Spending 

Account (FSAFEDS) Program, and Federal Long Term Care Insurance Program (FLTCIP). A 

phased retiree will continue to be eligible to enroll for coverage under these programs or 

make changes to existing coverage based upon existing law and regulation. 

If you have any other questions or comments regarding this BAL, you may email us at 

fegli@opm.gov. For more information on the FEGLI Program, please visit 

www.opm.gov/insure/life. 

John O’Brien 

Director 

Healthcare and Insurance 
ATTACHMENT 1 

FEGLI PHASED RETIREMENT BAL – Point of Contacts 

For general information on Phased Retirement, agency field offices should contact their 

appropriate headquarters-level agency human resources office. Agency headquarterslevel human resources offices may contact the following OPM offices:

Pay and Leave 

202-606-2858 

pay-leave-policy@opm.gov

U.S. Office of Personnel Management 

Pay and Leave, Employee Services 

1900 E Street, NW Room 7H31 

Washington, DC 20415 

Internal Placement, Promotions, Reduction in Force, Details, and Outside Employment 

202-606-0960 

employ@opm.gov

U.S. Office of Personnel Management 

Employee Services 

Recruitment and Hiring, Hiring Policy 

1900 E Street, NW Room 6500 

Washington, DC 20415 

Mentoring 

 202-606-0913 

gwmentoring@opm.gov 

 U.S. Office of Personnel Management 

1900 E Street, NW Suite 7439

Washington, DC 20415 

Partnership and Labor Relations, Employee Relations 

202-606-2930 

plr@opm.gov 

U.S. Office of Personnel Management 

Partnership and Labor Relations, Employee Services 

1900 E Street, NW Suite 7H28 

Washington, DC 20415 

Retirement Services, Benefits Officers Liaison and Development 

202-606-0788 

benefits@opm.gov

U.S. Office of Personnel Management 

Benefits Officers Liaison and Development, Retirement Services 

1900 E Street, NW Room SB 427 
Washington, DC 20415 

Planning and Policy Analysis, Federal Employee Insurance Operations 

202-606-0004 

Ronald.Brown@opm.gov

U.S. Office of Personnel Management 

Planning and Policy Analysis (FEIO) 

1900 E Street, NW Room 4312 

Washington, DC 20415 

Office of the Chief Financial Officer (OCFO), Financial Services 

202-606-0606 

FinancialBALs@opm.gov

U.S. Office of Personnel Management 

Chief Financial Officer, Financial Services 

1900 E Street, NW Room 5478 

Washington, DC 20415

Office of the Chief Information Officer (OCIO), Records Management 

202-606-1162 

Larry.Wells@opm.gov

U.S. Office of Personnel Management 

Chief Information Officer, Records Management 

1900 E Street, NW Room 2336

Washington, DC 20415