Order of Precedence and Designation of Beneficiary
ORDER OF PRECEDENCE AND PAYMENT OF BENEFITS
Order of Precedence
When you die, the Office of Federal Employees' Group Life Insurance (OFEGLI) will pay life insurance benefits in a particular order set by law.
If you assigned ownership of your insurance (usually by filing an RI 76-10, Assignment of Life Insurance), OFEGLI will pay:
- First to the beneficiary(ies) the assignee(s) validly designated;
- Second, if none, to the assignee(s).
If you did not assign ownership and there is a valid court order on file with your agency or OPM, as appropriate, OFEGLI will pay benefits according to the court order.
If you did not assign ownership and there is no valid court order on
file with your agency or OPM, as appropriate, then OFEGLI will pay:
- First, to the beneficiary(ies) you validly designated;
- Second, if none, to your widow or widower;
- Third, if none of the above, to your child or children and the descendants of any deceased children (a court will usually have to appoint a guardian to receive payment for a minor child);
- Fourth, if none of the above, to your parents in equal shares, or the entire amount to the surviving parent;
- Fifth, if none of the above, to the court-appointed executor or administrator of your estate;
- Sixth, if none of the above, to your other next of kin entitled under the laws of the State where you lived.
Assignments and Court Orders
If you assigned ownership of your life insurance by filing an Assignment of Life Insurance (RI 76-10 [289 KB]), OFEGLI will pay benefits to the beneficiary(ies) designated by your assignee(s), if any. If there is no such beneficiary, OFEGLI will pay benefits to your assignee(s).
If you did not assign ownership and there is a valid court order on file, OFEGLI will pay benefits in accordance with that court order.
If No Claim Is Filed
If the person who is entitled to payment under the order of precedence doesn't file a claim within one year after your death (or if payment to the person who filed is forbidden by Federal law or regulation), the Office of Federal Employees' Group Life Insurance can pay the person next in the order of precedence, just as if the person who would otherwise get the payment had died before you did.
This payment bars any other person from collecting payment.
If the person who is entitled to payment under the order of precedence doesn't file a claim within two years after your death, and neither OPM nor the Office of Federal Employees' Group Life Insurance (OFEGLI) has received notice that such a claim will be made, OFEGLI can pay the claimant who in OPM's judgment is equitably entitled to the payment. This payment bars any other person from collecting payment.
If a valid claim has not been filed and no claim is pending four years after your death, OFEGLI returns the insurance proceeds to OPM for deposit in the Employees' Life Insurance Fund.
Option C
Option C benefits are paid to you upon the death of your spouse or eligible child(ren).
If you die after your spouse or eligible child(ren) die, but before Option C benefits are paid (whether or not you filed for the benefits), the payment will go to the person(s) eligible for the benefits of your Basic insurance. If you had assigned your Basic insurance, Option C payment will be made under the order of precedence, excluding any previous designations of beneficiary made invalid by your assignment.
DESIGNATION OF BENEFICIARY
Designation
Recommended
OPM recommends that you designate beneficiaries to
receive your life insurance proceeds. However, if you are
satisfied with the order of precedence, you need take no
action.
It is necessary to designate a beneficiary to assure
that benefits will be paid as you wish:
- if you want benefits to go to a person, firm,
organization, or other legal entity not listed in
the order of precedence;
- if you want benefits to be paid in a different
order from the order of precedence;
- if you want benefits to go to a trust you have
established for your minor children; or
- if evidence of a valid marriage or dissolution of
a marriage is not readily available.
You cannot designate beneficiaries if you have
assigned your insurance.
Who Can
Make a Designation?
The right to designate a beneficiary is a personal
right that cannot be exercised by anyone other than you
as the insured individual. Exception: If your
insurance has been assigned, only the assignee(s)
has(have) the right to make a designation.
Designations cannot be made by someone with a power of
attorney or by a court-appointed guardian, conservator,
trustee, or committee.
Designation Form
Completing a Designation of Beneficiary form (SF 2823) [119 KB]
is the preferred way for you to make a designation for
your FEGLI benefits. If you wish to make a designation,
you should complete this form and submit it to your
employing office. Your employing office must receive the
form before you die.
If you are a retiree or compensationer,
see "After Retirement" and
"After Becoming
Insured as a Compensationer" for instructions on where to submit your
designation.
When you complete the SF 2823, your signature must be
witnessed by two persons. These witnesses must also sign
the SF 2823 and give their addresses. A witness cannot be
someone you are naming on the form as a beneficiary.
A designation made in any other document is valid only
if the designation is specifically for your FEGLI
benefits, the document is signed by you, witnessed by two
persons not named as beneficiaries, received by your
employing office before you die, and does not contain any
errors that would cause its invalidity. See "Invalid
and Unacceptable Designations."
Receipt Before Death
Your employing office must receive your Designation of
Beneficiary before you die for your Designation to be
valid. A Designation delivered on a weekend or Federal
holiday is not "received," and is not valid,
until the next workday. If you die prior to your
employing office's receipt of a new Designation of
Beneficiary, benefits will be paid in accordance with the
next prior Designation on file or under the order of
precedence, if there is no designation.
Example
Brenda completes a new Designation of Beneficiary
and express mails it to her employing office on Friday,
June 3. It is delivered to her employing office on
Saturday, June 4. She dies on June 4. This Designation is
invalid since her employing office was not open and able
to receive her Designation prior to her death.
Importance
of Updating Designations
It is your responsibility to ensure that your
Designation of Beneficiary remains accurate and reflects
your intentions. You should be aware that benefits will
be paid based on a valid Designation, regardless of
whether that Designation still reflects your intentions.
A divorce does not invalidate a Designation
that names your former spouse as beneficiary.
You need to keep your designated beneficiaries'
addresses current. Failure to do so may mean that your
beneficiary cannot be located, and therefore benefits
will not be paid to that person. The preferred way is to
file a new Designation of Beneficiary whenever a
beneficiary's address changes. You may also ask your
employing office to attach a beneficiary's new address to
your current Designation of Beneficiary form, and your
employing office needs to ensure that the attachment is
forwarded along with the Designation of Beneficiary form
when you retire or die. A new address cannot be added
directly to the Designation of Beneficiary form itself,
since any cross outs, erasures, or alterations in your
form may make it invalid.
Naming
Multiple Beneficiaries
If you want to name more than one beneficiary, there
are two ways you can do this:
- You can designate percentages or fractions to go to each
person, e.g., 50% (or 1/2) to Karen, 25% (or 1/4) to Margaret, and
25% (or 1/4) to Barbara. The total must add up to
100% (or 1 for fractions).
- You can designate types of insurance to go to
various beneficiaries, e.g., Basic insurance to
Abby and Optional insurance to Mary Ann.
You cannot designate dollar amounts, except to the
Civil Service Retirement Fund.
If the SF 2823, Designation of Beneficiary form, does not have enough room for you to list all your beneficiaries, you can attach more names. Write "SEE ATTACHED" in Part B of the SF 2823. On your attachment, print your name, date of birth, and social security number at the top. Then list the information required in Part B of the SF 2823 for each of your beneficiaries. Sign the SF 2823 and the attachment. The same witnesses should witness both of your signatures and sign both the SF 2823 and the attachment. You may use this sample attachment:
Attachment to my SF 2823, FEGLI Designation, dated _______________
Name: _________________________________
Date of Birth: ___________________________
Social Security Number: __________________
I hereby designate:
First name, middle initial, last name |
SSN |
Address |
Relationship |
Percent/fraction designated |
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Total (Must equal 100% or 1.0) __________
Signature: ___________________________ Date: ______________________________
Witnesses to Signature:
__________________________________
__________________________________
Common-Disaster Clause
A common-disaster clause is a statement on the
Designation that says that a designated beneficiary only
gets the benefits if he/she survives you by a specified
minimum number of days. The number of days specified
cannot exceed 30.
You can name an alternate to receive the benefits in
this case. If you don't name an alternate, benefits will
be paid according to the order of precedence.
Example
John wishes to designate his wife as his
beneficiary, but add a common disaster clause. He states
in his SF 2823, Designation of Beneficiary form, that
benefits are to be paid to "Mary M. Smith, if she
survives me by 30 days. Otherwise, 50% to James R. Smith
and 50% to Susan K. Smith."
Employing Office
Review
Your employing office will review your Designation of
Beneficiary to verify that it has been completed properly
and will keep the original copy in the your Official
Personnel Folder. The duplicate copy is returned to you. Your
employing office will keep all prior designations of beneficiary on
file.
Invalid
and Unacceptable Designations
Your employing office will not accept a Designation of
Beneficiary if it is not completed properly. These are
some of the things that will cause a designation to be
invalid or unacceptable:
- The Designation is not signed by you.
- The Designation is signed by only one witness.
- The Designation is signed by your personal
representative or guardian.
- The Designation contains one or more crossouts,
erasures, or alterations.
- Your employing office doesn't receive your
Designation of Beneficiary until after you die.
- Your insurance has been assigned, and you, not
your assignee(s), signed the Designation.
- One or both of the beneficiaries signed as a
witness, and there are no
remaining (non-witnessing) beneficiaries named on
the designation. (If there are
remaining beneficiaries, the designation is not
invalid; however, payment will not be made to any
beneficiary who served as a witness. Payment will
be distributed to the remaining beneficiaries as
if the beneficiary(ies) who served as a witness
predeceased you.)
- The beneficiaries named on the original and the
duplicate copy of the Designation of Beneficiary
are different.
- Your name, as shown in the body of the
designation, is significantly different from your
signature. The difference is not significant if
initials of first and middle names are used in
one place and full names in the other.
- There is no specific beneficiary named. Examples
of this are:
- Per stirpes designations - ones that
provide for the equal distribution of
benefits among the children of a deceased
named beneficiary
- A designation in which the beneficiary does
not yet exist (e.g., "Mary Smith's
children, born and unborn")
Your employing office must return the
Designation to you if it has any of these
errors. However, your employing office's
failure to return an incorrect Designation of
Beneficiary does not make the
Designation valid.
If your employing office has any questions
about whether a Designation is valid, it
should send both copies of the Designation of
Beneficiary to the Office of Federal
Employees' Group Life Insurance (OFEGLI) to
request a determination on whether the
Designation is acceptable.
Errors to Avoid
To ensure ease of payment to your beneficiaries, you
should avoid these errors when completing a Designation
of Beneficiary form:
- Beneficiaries' shares totaling less than or more
than 100% or stating shares in dollar amounts,
rather than percentages or fractions.
- Not stating the given name of the beneficiary
(e.g., "Mrs. John Doe" instead of
"Mary Doe").
- Making provisions that cannot be recognized, such
as "payment of just debts" or
"payment in installments" or "to
Tom, when he reaches age 21."
- Not clearly stating that you are naming a
contingent beneficiary (e.g., "John Doe or
Mary Doe" instead of "John Doe if
living, otherwise to Mary Doe").
Payment
when Designation is Invalid
Payment will be made in accordance with your next
prior valid Designation of Beneficiary (or according to
the order of precedence, if there is no designation) when
your latest Designation form:
- either lacks your signature or witnesses'
signature(s);
- was not received by your employing office prior
to your death; or
- was signed while you were incompetent or under
undue influence, as found by a court of competent
jurisdiction.
Payment will be made in accordance with the order of
precedence when your latest Designation form:
- names a beneficiary who predeceased you and there
are no other surviving named beneficiaries;
- names a beneficiary who forfeited his/her right
to the proceeds by willful and malicious
wrongdoing which caused your death (and no other
beneficiaries were named);
- names a trust that was never established (and no
other beneficiaries were named); or
- names an entity that does not exist, or for which
there is no legitimate, recognized successor
organization (and no other beneficiaries were
named).
Employing
Office Advice to Employees
When you become insured, your employing office must
inform you of the order of precedence and the option of
designating a beneficiary.
From time to time employing offices should remind
their employees that changes in family status, without a
corresponding change in designation of beneficiary, could
result in benefits not being paid the way you want.
Designations
for Other Federal Benefits
Completion of the Designation of Beneficiary form (SF
2823) does not designate any other type of benefits -
only FEGLI. There are separate forms to be used for other
types of designations, as follows:
- SF 2808 (Designation of Beneficiary, CSRS)
- SF 3102 (Designation of Beneficiary, FERS)
- SF 1152 (Designation of Beneficiary, Unpaid
Compensation of Deceased Civilian Employee)
- TSP 3 (Designation of Beneficiary, Federal
Retirement Thrift Savings Plan)
DESIGNATING A TRUST
Information Required
You can designate a person or institution as a trustee
under the terms of a trust agreement to receive the life
insurance benefits upon your death.
To make sure that these designations are clear and to
allow quick identification of the entitled party, the
Office of Personnel Management has established
suggested formats to use for these designations. To be
valid, the trustee designation must be attached to and
made a part of the Designation of Beneficiary form. The
employing office should receipt the attachment in the
same manner as the Designation of Beneficiary in case it
gets separated from the Designation. The Designation of
Beneficiary form should state "See attached" in
the space for the designation.
While it is not absolutely necessary to use the
OPM-established formats, the following information
must be included for the designation to be valid:
- a statement that the FEGLI death benefit is to be
paid to the trustee or successor trustee, and
- name and date of the Trust (for inter vivos
trusts).
Inter Vivos Trusts
An inter vivos trust is one that you
establish during your lifetime.
This is a link to a suggested format for this type of trust.
Testamentary Trusts
A testamentary trust is one that you create by your
will at death.
This is a link to a suggested format for this type of
trust.
Other Formats
If you want to use some other format, cannot provide
the information requested above, or need additional
information about designating a trust, please
contact the Office of Federal Employees' Group Life
Insurance (OFEGLI) in writing at P. O. Box 2627, Jersey City, NJ 07303-2627 or call 1-800-633-4542.
CHANGING OR CANCELLING DESIGNATIONS
Your Right to Change or Cancel
Unless you have assigned your life insurance, or (effective July 22, 1998) your employing office has received a court order requiring benefits to be paid to a specific
person(s), you have the right to change or cancel your designation of beneficiary at any time, without the knowledge or consent of any previous beneficiary.
Changing Your Designation of Beneficiary
To change or cancel your Designation of Beneficiary, fully complete a new Designation of Beneficiary form and
submit it to your employing office. If you have a prior Designation of Beneficiary on file, and now wish for
benefits to be paid in accordance with the order of precedence, your Designation should state "Cancel
Prior Designations."
Automatic Cancellation
Your Designation of Beneficiary is automatically
cancelled under any of the following circumstances:
- 31 days after your insurance terminates, unless you are eligible and continue insurance as an
annuitant or compensationer;
- On the day your annuity terminates, unless you are entitled either to OWCP benefits (and
determined by the Department of Labor to be unable to return to duty) or to an immediate
annuity under another provision of retirement law;
- On the day your compensationer's benefits
terminate or you are determined to be able to
return to duty, unless you are entitled to
continue insurance as an annuitant or unless you
return to Federal service on the day after
compensation terminates;
- On the effective date of an assignment of
insurance.
Designations
Do Not Transfer to Conversion Policies
If you separate from Federal service and convert your
life insurance to a private policy, any designation of
beneficiary you made under the FEGLI Program does not
convert. If you wish to designate a beneficiary under
your conversion policy, you must contact the insurance
company that issued the conversion policy.
Designations
Remain Valid upon Transfer to Another Agency
Effective November 17, 1986, a Designation of
Beneficiary remains valid through transfer to another
agency. Prior to this date, designations were cancelled
upon transfer to another agency (except for mass
transfers). If your Designation of Beneficiary and
subsequent transfer to another agency was before November
17, 1986, your designation on file is invalid. You should
file a new Designation.
Your employing office must alert the Office of Federal
Employees' Group Life Insurance (OFEGLI) to any
designations and subsequent transfers made prior to
November 17, 1986, when life insurance forms are sent to
OFEGLI.
RETIRING EMPLOYEE DESIGNATIONS
Continuing Designations
When you retire and are eligible to continue your FEGLI as an annuitant, any valid Designation of
Beneficiary on file with your employing office will remain valid, unless your annuity terminates or you
change or cancel the Designation.
Procedure at Retirement
Unless you elect to convert your insurance, your
employing office must attach any Designation of
Beneficiary form (SF 2823 or SF 54), assignment form (RI 76-10)
and/or court order directing payment
of FEGLI benefits to your retirement
application and send it, together with the original
Agency Certification of Insurance Status (SF 2821), to
the retirement system.
If you are separating for disability retirement under
CSRS after a finding of total disability has been made by
OPM, your employing office will send the Designation of
Beneficiary form and/or court order with the final Individual Retirement
Record (SF 2806).
You must submit any future designations, changes in
designation, assignments, or court orders
directing payment of FEGLI benefits to OPM at Retirement Operations Center, P.O.
Box 45, Boyers, PA 16017-0045.
Delayed Retirements
If you are a separating employee eligible to retire
under FERS MRA+10 provisions, but you don't file an
application, your employing office must keep any current
Designation of Beneficiary, assignment, and/or court order directing payment of FEGLI
benefits in your Official Personnel
Folder. Your employing office will check the appropriate
box on the Agency Certification of Insurance Status (SF
2821) to show that the Designation has been retained.
When you later apply for retirement, the retirement
system will request your Designation from the National
Personnel Records Center. Your most recent Designation on
file will be made valid upon reinstatement of your life
insurance. If you want to change your Designation,
contact OPM at Retirement Operations Center, P.O. Box 45,
Boyers, PA 16017-0045.
After Retirement
An annuitant has the same rights as an employee to
make, change, or cancel a Designation.
If you are retired, you must submit your Designation
of Beneficiary to the Office of Personnel Management,
regardless of the retirement system you are retired
under. Send your completed Designation of Beneficiary to
Retirement Operations Center, Validation Section, Boyers,
PA 16017. Send assignments and/or court orders directing payment
of FEGLI benefits to the same address.
OPM must receive the Designation of Beneficiary,
assignment, and/or court order before
you die. See "Receipt Before Death."
Filing
a Designation of Beneficiary during Reemployment
When you file a Designation of Beneficiary as a
reemployed annuitant, you should submit it to OPM,
Retirement Operations Center, P.O. Box 45, Boyers, PA
16017-0045. If you have insurance coverage through your
reemployment (premiums are withheld from your pay, not
your annuity), you may also file your Designation with
your employing office. Your employing office must enter
the words "Reemployed Annuitant" and your
retirement claim number on the Designation form and send
it to OPM.
DESIGNATIONS
WHILE IN RECEIPT OF WORKERS' COMPENSATION
Continuing Designations
When you are receiving compensation and are eligible
to continue FEGLI as a compensationer (after separation
or the completion of 12 months' nonpay status), any valid
Designation of Beneficiary on file with your employing
office will remain valid, unless your compensation
terminates or you change or cancel your designation.
Employing
Office Procedures When You Become Insured as a
Compensationer
Unless you elect to convert your insurance as a
compensationer, the employing office must attach the
Designation of Beneficiary form (SF 2823 or SF 54),
assignment form (RI 76-10), and/or court order
directing payment of FEGLI benefits to the
original Agency Certification of Insurance Status (SF
2821), and send it to the Office of Personnel Management.
Your employing office must inform you of your
designation rights and advise you that you must submit
any future designations to OPM.
Until you separate or complete 12 months' nonpay
status, you are insured as an employee, not as a
compensationer. You must submit any designations of
beneficiary, assignment, or court orders during this period to your employing office,
not to OPM.
After
Becoming Insured as a Compensationer
A person insured as a compensationer has the same
rights as an employee to make, change, or cancel a
designation.
If you are a compensationer, you must submit your
completed Designation of Beneficiary form to OPM at
Retirement Operations Center, Validation Section, Boyers,
PA 16017. Send assignments and/or court orders directing payment
of FEGLI benefits to the same address.
OPM must receive the Designation of Beneficiary,
assignment, and/or court order before
you die. See "Receipt Before Death."
COURT ORDERS
Effective July 22, 1998, FEGLI benefits must be paid in accordance with the terms of a valid court order, regardless of whether you actually complete a Designation of
Beneficiary form complying with the court order.
The court order supersedes any of your prior designations. When such a court order is in effect, you cannot change your
designation, unless the person(s) named in the court order agree(s)
in writing or unless the court order is subsequently modified.
A court order may direct you to make an irrevocable assignment to the
person(s) named in the court order. However, until you properly
complete an assignment form,
the assignment does not occur.
Submission of Court Order
To be valid, a certified copy of the court order must be submitted
to your employing office on or after July 22, 1998, and before your
death. Anyone can submit the court order. (Court orders
submitted for other reasons prior to July 22, 1998, are not
valid for FEGLI purposes. The court order must be resubmitted.)
If you are an annuitant, the court order must be sent to OPM at
Retirement Operations Center, P.O. Box 45, Boyers, PA
16017-0045. If you are a compensationer, during the first 12
months of nonpay status the court order must go to your employing
office. After you separate or complete 12 months in nonpay
status, the court order must be sent to OPM.
Disposition of Court Order
A court order must be filed in your Official Personnel Folder
(OPF). Your employing office must clearly stamp the court order with
the receipt date and flag your OPF in some way to indicate that it
contains a court order. Your employing office will not review the
court order or make any determination on its validity.
If your employing office receives a subsequent court order for you,
it should date stamp and file it in the OPF, with the other court
order(s). Your employing office should send all court orders along
with the other life insurance forms to either OFEGLI (at your death)
or OPM (at your retirement). At the time of your death, OFEGLI will
determine which court order, if any, is valid for payment of benefits.
If you submit a designation of beneficiary when you have a court
order on file, your employing office should review it to see if it is
completed properly [link to "Employing Office Review"],
certify its receipt, and file it in your OPF. Your employing office
should notify you that there is a court order on file and that the
designation may not be valid. At the time of your death, OFEGLI will
determine whether the court order is still in effect or whether
benefits should be paid according to the designation.