Evening star. [volume] (Washington, D.C.) 1854-1972, 1954-08-05
By Froneis P. Douglas

Government employees men,.
bers Of Congress. too-who are
IS or older, will receive free life
insurance policies, under the
group insurance plan voted by
Congress and now awaiting
President Eisenhower'S sigma
ture
This means that a $5.000-a-
year Government employe will
receive a $1,000 policy. But for
every month he Is over IS, the
face value will be reduced by
q per cent a month. It cannot.
however, go below one-fourth of
the face value, so the employe
in question will have not less
than S. $50 to leave his heirs:
In the case of members OF
Congress. who are paid $4,000.
this means a $4,000 policy for
a member who is just IS. BY
the time he is a month past 68.
the value will be $3.50, but it
will go no lower.
For some recipients of policies
this would amount to a wind
fall" as the term is used in the
Senate Banking Committees in
vestigation of profits under Gov
rnment-insured rental housing
loans.
It also developed today that: ,
/. Some Washington insurance
companies are expecting to-
share in the group policy bust
ness on the basis of reinsuring
policies originating with larger
companies.
Tax Revenue for d. C.
2. The District stands to col
lect an estimated $177.000 a
year in taxes on the premiums
paid the insurance companies.
3. Not many employees will
be required to handle the paper
work here-about six or eight
in the Civil Service Commission.
and about 20 in the Office to be
set up by the underwriters.
The group policies will be es-
pecially advantageous buys for
those Government employees who
are along in years. Take, for
example, the employe who is
go and who makes $4,000 year.
He and all others pay $3.50 per
year per 81, 900 of insurance, and
the Government pays 1925.
At IS, the employe stops pay
ing, but coincidentally his insur-
ance starts decreasing at the
2 per cent a month rate.
An employe who is 81 and is
still working pays no premiums,
but he gets a policy based on
the amount of his earnings at
65 and reduced by 2 per cent
o month since then.
Restrictions Changed.
AS originally drawn, the bill
would have made it impossible
for insurance companies organ
lied under District laws to par
ticipate in the business. The
bill originally provided that the
business would be handled ex-
clusively by life insurance COM
panies having at least / per cent
of the total group life insurance
in the country. The total last
December 81 was almost $50
billion. A company to partici-
pate in the underwriting would
have to have $500 million group
insurance in force.
It was estimated only eight
or 10 companies could qualify
under this provision.
Another provision was that,
for a company to share in the
business by reinsuring policies
originating with the big con-
Germs, the reinsuring company
WOu1O k4GfC w 41dtO SAOAP AAAV
insurance in force on employees
Of at least Is employers.
Representatives of the Govern
ment Employees Life Insurance
Co., Acacia Mutual, Equitable
Life Insurance Co. and Peoples
Life Insurance Co. all Of Wash
ington, appeared before the
Senate Civil Service Committee
and succeeded in getting these
restrictions eliminated.
Acacia to Make Statement.
The Government Employe:
concern said today it wants tt
share in the reinsurance of the
group policies. Acacia said il
is interested in the business but
is waiting to find out exactly
what the rules will be before de-
Gliding what it will do. Equitable