(a) (1) Section 208 of the Bankruptcy Amendments and Federal Judgeship Act of 1984, Pub. L. 98-353 (98 Stat. 355), effective July 10, 1984, permits Federal judges to irrevocably assign their FEGLI coverage to one or more individuals, corporations, or trustees. Section 4 of Pub. L. 103-336 (108 Stat. 2661), effective October 3, 1994, extended this right to all Federal employees, annuitants, and compensationers.
(2) An individual may assign ownership of all life insurance under this part, except Option C. If an individual wishing to make an assignment owns more than one type of coverage, he/she must assign all the insurance; an individual cannot assign only a portion of the coverage. Option C cannot be assigned.
(b) An individual cannot name conditional assignees in case the primary assignee dies before the insured individual.
(c) If the insurance is assigned to two or more individuals, corporations, or trustees, the insured individual must specify percentage shares, rather than dollar amounts or types of insurance, to go to each assignee.
(d) If an individual who has made an assignment later elects increased insurance coverage under § 870.506 or during an open enrollment period, the increased coverage is considered included in the already existing assignment. The right to increase coverage remains with the insured individual, rather than transferring to the assignee.
(e) An individual who assigns ownership of insurance continues to be the insured individual, but the assignee receives those rights of an insured individual that are specified in this part.
(f) Once assigned, the value of the insurance increases or decreases automatically as provided by this part. Exception: if the insured individual elected a Living Benefit before assigning the remainder of his/her insurance, the amount of Basic insurance does not increase or decrease.
(g) An insured individual who has assigned his/her insurance cannot elect a Living Benefit; nor can an assignee elect a Living Benefit on behalf of the insured individual.
(h) An insured individual who has elected a Living Benefit under subpart K of this part may assign the remainder of his/her insurance. The assignment would affect Option A, Option B, and, for an employee who elected a partial Living Benefit, Basic insurance.
(i) A court order can direct that an insured individual make an irrevocable assignment to the person(s) named in the court order. For an assignment to be effective, the insured individual must follow the procedures in § 870.902.
[62 FR 48731, Sept. 17, 1997, as amended at 64 FR 16602, Apr. 6, 1999]
Notes of Decisions
Metro. Life Ins. Co. v. Potter, 533 So. 2d 589 (Ala. 1988).
· cites it 8× “" 5 C.F.R. § 870.901 (e). 1 The FEGLI Act further provides: "The provisions of any contract under this chapter which relate to the nature or extent of coverage or benefits (including payments with respect to benefits) shall *Page 591 supersede and preempt any law of any State or…”
Sharon O'Neal v. Constance Gonzalez, 839 F.2d 1437 (11th Cir. 1988).
· cites it 2× “5 C.F.R. § 870.901 (1986). O’Neal contends that the Act and regulations merely set forth a procedure for disbursing the proceeds while conferring no substantive right of payment upon the designated beneficiary.”
Metro. Life Ins. v. McShan, 577 F. Supp. 165 (N.D. Cal. 1983).
· cites it 2× “” 5 C.F.R. 870.901(e) (1983). At least one district court has reached the conclusion advanced by plaintiff.”
Est. of Hanley v. Andresen, 693 P.2d 198 (Wash. Ct. App. 1984).
· cites it 3× “Further, such a change in a will or other document not so witnessed and filed is without force or effect, 5 C.F.R. § 870.901 (b), and the right to change the beneficiary cannot be restricted.”
Knowles v. Metro. Life Ins., 514 F. Supp. 515 (N.D. Ga. 1981).
“[Emphasis supplied] This provision, having the force and effect of law, must control. The marriage settlement agreement thus cannot operate as a waiver or restriction of the insured’s right to change this beneficiary, and the named beneficiary, under the provisions of 5 U.”
Metro. Life Ins. v. Smith, 727 F. Supp. 234 (W.D.N.C. 1989).
· cites it 2× “5 C.F.R. § 870.901 (a)-.901(b) (1987) (emphasis added).”
Mobley v. Metro. Life Ins., 907 F. Supp. 495 (D.D.C. 1995).
· cites it 5× “A “recognized natural child” is a child for whom the father: (A) Has acknowledged paternity in writing; (B) Has been judicially ordered to provide support; (C) Has, before his death, been judicially decreed to be the father; (D) Has been established as the father by a certified…”
O'NEAL v. Gonzalez, 653 F. Supp. 719 (S.D. Fla. 1987).
“The court emphasized the provision of 5 C.F.R. § 870.901 (3) to the effect that the right of the insured to change beneficiary cannot be waived or restricted.”
Dean v. Johnson, 881 F.2d 948 (10th Cir. 1989).
“8705(a) 1 and corresponding regulation, 5 C.F.R. 870.901 (1986) 2 , precluded Ms.”
McGovern v. Broadstreet, 720 P.2d 589 (Colo. Ct. App. 1985).
“” In addition, the governing regulation states in pertinent part that: “A change of beneficiary may be made at any time and without the knowledge or consent of the previous beneficiary, and this right cannot be waived or restricted.”
Adams v. MacY, 314 F. Supp. 399 (D. Maryland 1970).
“8705 (a) and implementary regulations, particularly 5 C.F.R. 870.901(c): A witness to a designation of beneficiary is ineligible to receive payment as a beneficiary.”
Dean v. Johnson, 881 F.2d 948 (10th Cir. 1989).
“Despite the harshness of the result, the Eleventh Circuit found § 8705(a) 1 and corresponding regulation, 5 C.F.R. 870.901 (1986) 2 , precluded Ms.”
— 5 C.F.R. § 870.901(c) — 1 case
Adams v. MacY, 314 F. Supp. 399 (D. Maryland 1970).
“8705 (a) and implementary regulations, particularly 5 C.F.R. 870.901(c): A witness to a designation of beneficiary is ineligible to receive payment as a beneficiary.”
— 5 C.F.R. § 870.901(e) — 1 case
Metro. Life Ins. v. McShan, 577 F. Supp. 165 (N.D. Cal. 1983).
“” 5 C.F.R. 870.901(e) (1983). At least one district court has reached the conclusion advanced by plaintiff.”
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