FEGLI Option B After 65: Premiums by Age and the 20-Year Cost

What OPM’s tables say, and since when

The tables are on OPM’s FEGLI program information page, which we fetched on November 11, 2026. The page says: “These rates were effective on the first pay period that started on or after October 1, 2021.” Under each table OPM adds “Rates may change in the future.” We searched for a Federal Register notice or an OPM benefits letter changing the annuitant rates for 2026 or 2027 and found none, so the figures below are the ones in force today. Any later change would be announced by OPM before it takes effect.

Source: OPM, FEGLI program information, “Premiums for Annuitants,” fetched November 11, 2026. The same page lists under 35 at $0.043, 35–39 at $0.043, 40–44 at $0.065, 45–49 at $0.130 and 50–54 at $0.217.

OPM’s note under the table: “For eligible annuitants who elected No Reduction for Option B, coverage is NOT free for age 65+.” The statute behind it, 5 U.S.C. 8714b, says that if the retiree elects Full Reduction the additional insurance is “without cost” after the month of the 65th birthday, and that a retiree may instead elect to have the full cost “continue to be withheld” so that the amount “shall not be reduced.” There is no government contribution to Option B: the retiree pays the whole premium.

The yearly cost of Option B at a $100,000 final salary

Option B comes in “one, two, three, four, or five multiples of your annual pay” (OPM Handbook), and for a retiree the amount is the amount in force when the job ended. For a final salary of $100,000, which is already an even thousand, one multiple is $100,000. The yearly premium is the monthly rate times 100 times 12 for each multiple.

Source: our arithmetic from OPM’s annuitant rates (effective October 1, 2021). Final salary $100,000. A different salary scales the table in proportion: $150,000 is 1.5 times every figure.

Seen as a share of what the policy pays, the premium is 1.25% of the coverage a year at 65–69, 2.24% at 70–74, 4.68% at 75–79 and 7.49% at 80 and over (our arithmetic). The coverage is the same each year; only the age band changes.

From 65 to 85: No Reduction against Full Reduction

Here the two elections are set side by side for one multiple and for five. The No Reduction figures add each year’s premium from the 65th birthday, starting each band on the birthday and counting 12 months a year. Premiums before 65 are the same under both elections, so they are left out.

Source: our arithmetic from OPM’s annuitant rates; the yearly cumulative figures are in the CSV. The Full Reduction column is $0 because OPM’s handbook says that if you elect Full Reduction, “your Option B and/or Option C is free once the coverage starts to reduce.”

In the 75–79 band the premium for one multiple is $390 a month, and from 80 it is $624 a month, for $100,000 of coverage (our arithmetic). The $78,258 for one multiple is not a payout or a loss: it is what the same $100,000 of cover costs over 20 years at today’s rates. If rates change, the total changes.

What Full Reduction leaves, month by month

Under Full Reduction “each multiple starts reducing by 2 Percent of the pre-retirement amount each month” until the final value is $0 (OPM Handbook), and the reduction begins at the start of the second month after the 65th birthday (or after retirement, if later). On a $100,000 multiple that is $2,000 a month.

Source: our arithmetic from 5 U.S.C. 8714b(c)(3)(A) (2% a month for 50 months) and OPM’s FEGLI Handbook. The statute says “the reduction under clause (i) shall continue for 50 months at which time the insurance shall stop.”

So the coverage runs out about four and a quarter years after 65: the first reduction comes in the second month after the birthday and the last in the 50th. A retiree who elects Full Reduction and dies after that point has no Option B benefit.

Partial elections, and what can still be changed

The elections are per multiple. The handbook says a retiree “may choose Full Reduction for some multiples and No Reduction for other multiples,” and gives an example of a retiree with five multiples who changed four to Full Reduction and kept one at No Reduction. The rules on change in OPM’s handbook:

Source: OPM, FEGLI Handbook (June 2019), chapter on post-65 reductions. The age-65 notice mentioned in the handbook gives a second chance to change the election shortly before the 65th birthday.

The difference between cancelling and moving to Full Reduction matters because the handbook defines it: “If you cancel a multiple, that coverage (and the premiums) stop right away.” If you change to Full Reduction instead, the coverage “goes away gradually (2 Percent each month).” On getting coverage back, the handbook says: “If you are insured as an annuitant or compensationer, you cannot cancel your waiver,” with an exception for annuitants who are reemployed after a 180-day break. So OPM’s documents describe cancelling as one-way for a retiree, and Full Reduction after 65 as one-way as well.

Basic insurance after 65: the three elections

Basic insurance is priced differently from Option B: a level premium per $1,000 of the Basic Insurance Amount (BIA), which for a $100,000 final salary is $100,000 plus $2,000, or $102,000. OPM’s handbook says the post-65 choices are 75% Reduction (the default if you make no election), 50% Reduction and No Reduction.

Source: OPM FEGLI program information (“Cost for each $1,000 of the Basic Insurance Amount in Effect at the Time of your Retirement,” effective October 1, 2021); coverage left from OPM’s Handbook; dollar columns are our arithmetic. Before 65 the monthly cost at $102,000 is $35.36, $111.86 and $264.86.

Under 75% Reduction the coverage falls by 2% of the BIA a month ($2,040) until 25% remains; under 50% Reduction it falls 1% a month ($1,020) until 50% remains. OPM’s page says the 50% and No Reduction premiums are paid “for life (unless you cancel or subsequently elect 75% Reduction).” The handbook says that if you change a 50% or No Reduction election, the Basic amount “switches automatically” to what 75% Reduction would have left, with no refund of the extra premiums. A 50% Reduction election cannot later be changed to No Reduction.

The extra coverage on Basic costs a flat $3.00 per $1,000 a month in both cases (the $0.75 buys the extra 25% of the BIA and the $2.25 the extra 75%) (our arithmetic). Option B at No Reduction costs less than that at 65–74 ($1.040 and $1.863) and more at 75 and over ($3.900 and $6.240), so the relative price of the two changes with age.

What a reader can do with this

1. Find your final salary rounded up to the next $1,000 and multiply the table above in proportion to see what each multiple costs in each band.
2. Compare the 65–69 premium with the 75–79 and 80-plus premiums for the same coverage: the yearly figure is the one you would be paying at the ages when it is highest.
3. Check which election is on file. OPM sends a reminder letter shortly before the 65th birthday asking if you want to change it, and after 65 only the move from No Reduction to Full Reduction is open.
4. If someone besides you would receive the benefit, look at whether the life insurance is taxable to the estate; see our page on life insurance and estate inclusion.
5. Put the premium next to the rest of the retirement budget. The January 2027 cost-of-living adjustment is on our Social Security COLA page, and the cost of care that insurance may be meant to cover is in our long-term care rate-increase page.

Before you decide whether to keep Option B past 65

Under No Reduction, Option B is priced by age band, so the premium climbs every five years after 65, and for an annuitant OPM’s handbook treats a cancelled multiple as gone. The choice also interacts with how much other coverage you have and with who depends on the payout, which are not in OPM’s tables. This page does not say which election is right; it says what each one costs and what each leaves, from the documents.

More for federal retirees, read from the same kind of primary documents: the 2027 FERS and CSRS COLA by retirement month, FEHB and PSHB 2027 premiums, plan by plan, the FERS supplement's 2027 earnings limit, FLTCIP premium increases since 2010, OPM's retirement backlog, month by month, keeping the TSP or rolling it to an IRA and the TSP L Funds' allocations and glide paths.

FAQ

This is analysis of public documents, not investment, legal or tax advice.

Sources, read and saved on November 11, 2026: OPM, FEGLI program information page (“Premiums for Annuitants,” rates effective on the first pay period on or after October 1, 2021; opm.gov/healthcare-insurance/life-insurance/program-information/); OPM, FEGLI Handbook (June 2019; feglihandbook.pdf); 5 U.S.C. 8714b, Optional life insurance, additional (law.cornell.edu). All dollar figures labelled as our arithmetic are ours, built from those documents; they are not quotes and not an offer from OPM or OFEGLI.