Survivor Annuity
Concerns & Options.
Electing a survivor annuity is one of the most consequential decisions you make at retirement — and one of the least reversible. Understanding the true cost, the FEHB health insurance link, and the risks of replacing it with private insurance is essential before you sign your retirement papers.
What you can
elect at retirement.
Both CSRS and FERS offer a choice of survivor benefit levels — full, partial, or none. Each has a different cost to your annuity and a different benefit to your surviving spouse. The decision must be made at retirement and your spouse must agree in writing to any reduction or elimination of the benefit.
Many approaching retirement debate whether to take a full survivor annuity — which reduces their monthly check by roughly 10% — or to purchase a private insurance policy instead. It is a legitimate debate, but one that requires a clear-eyed look at the risks on both sides before you commit to an irrevocable election.
Retirees can take a full or partial survivor annuity depending on their personal situation and how much they have saved through prudent investing. Regardless of what you decide, there are several key facts you must understand before signing the retirement application.
Your spouse must agree in writing to a reduced or waived survivor annuity. And if you elect no survivor benefit, your spouse loses FEHB health insurance coverage when you die.
CSRS Survivor Options
Civil Service Retirement System
FERS Survivor Options
Federal Employees Retirement System
Survivor election &
your spouse's health insurance.
The connection between survivor annuity elections and FEHB health insurance coverage is one of the most important — and most frequently misunderstood — aspects of federal retirement planning.
What OPM says about FEHB and survivor benefits
"If you were enrolled in a self and family plan at the time of your death and a monthly survivor benefit is payable, then your spouse and eligible dependents can continue your health insurance."
"If a monthly benefit is not payable, your spouse and eligible family members will have a one-time opportunity to enroll in private health coverage with the insurance provider."
The insurance alternative — risks to weigh
Some retirees consider replacing the survivor annuity with a private life insurance policy, reasoning that the premium may be lower than the 10% annuity reduction. The math can sometimes work. The risks are real and deserve careful evaluation before you commit.
| Option | Backing | Risk level | Key consideration |
|---|---|---|---|
| Survivor annuity | Federal government | Very low | Guaranteed for life, increases with COLA, preserves FEHB for spouse. No third party involved. |
| Private life insurance (term) | Insurance company | Medium | Premiums increase with age. Coverage ends when policy lapses or premium becomes unaffordable. FEHB eligibility for spouse is lost. Company must be financially solid — verify with A.M. Best or similar. |
| No survivor benefit, no insurance | Nothing | High | Spouse receives no income after your death and loses FEHB. Only appropriate if spouse has substantial independent income and alternative health coverage. |
If you choose private insurance — verify the company first
Insurance companies can go bankrupt. Before replacing your survivor annuity with a private policy, check the insurer's financial strength rating with one or more of the following services:
A.M. Best — rates insurers from A++ (Superior) to S (Rating Suspended). Free with registration at ambest.com.
Moody's Investor Service — moodys.com
Standard & Poor's — standardandpoors.com
Only work with companies rated in the top tiers. A mid-tier rating today can decline. Your spouse's financial security depends on the company still being solvent decades from now.
Calculating the exact dollar reduction
The reduction formulas differ between CSRS and FERS. Using a $40,000 annual annuity as a concrete example:
CSRS — full 55% survivor annuity on $40,000 annual annuity
FERS — full 50% survivor annuity on $40,000 annual annuity
The survivor benefit also grows with COLAs
Your spouse will receive 55% (CSRS) or 50% (FERS) of your annuity at the time of your death — but that amount increases each year a COLA is granted, just as your own annuity does. The annual Notice of Annuity Adjustment you receive each January lists the survivor annuity benefit just below the table on the first page. Keep a copy in your estate file.
If the survivor predeceases the retiree
If your spouse dies before you do, the survivor deduction to your annuity stops. You will receive your full, unreduced annuity going forward. There is no reimbursement for deductions already made.
Think of it like a life insurance premium that was never claimed
Prior deductions from your annuity for the survivor benefit are very similar to payments made on a life insurance policy that was never used. When the policyholder no longer needs coverage, the policy is canceled and prior premiums are not returned. The deductions stop when the need disappears — but what was paid is not refunded. Contact OPM for more information if this situation applies to you.
How to verify a survivor election
A surviving spouse can call OPM to confirm whether a spousal annuity was elected and what the benefit amount will be.
Verifying a survivor election with OPM
Call OPM at 1-888-767-6738. Have the annuitant's Social Security number and/or CSA retirement account number ready. Call early in the morning — later in the day the line is frequently busy.
This information is also on the original retirement application. Every federal retiree should keep a copy of their signed retirement application in their estate paperwork — it is the definitive record of elections made at retirement.
When an annuitant's death is reported to OPM, the annuity is automatically adjusted to the reduced (survivor) amount and sent to the spouse of record if a spousal annuity was elected.
Electing a survivor annuity for a new spouse after retirement
If you marry after retirement, you can elect a reduced annuity to provide a survivor benefit for your new spouse — but you must act within a strict deadline.
What the election looks like for each system
CSRS: You can elect any portion of your annuity — from 55% of $22 (resulting in a $1/month survivor benefit) up to 55% of your full unreduced annuity.
FERS: A full benefit is 50% of your unreduced annuity; a partial benefit is 25% of your unreduced annuity.
Important exception: If you remarry the same person you were married to at retirement, you cannot elect a survivor annuity greater than what you elected at the original retirement.
The actuarial reduction for post-retirement marriage
Electing a survivor benefit for a new spouse after retirement results in two reductions to your annuity: the standard survivor benefit reduction, plus a permanent actuarial reduction equal to the difference between the new annuity rate and the old one — including 6% interest — since your retirement date.
In most cases, the actuarial reduction amounts to less than 5% of your annuity. Critically, the actuarial reduction continues even if the marriage later ends. Contact OPM and they will send you a statement describing the full cost before you confirm the election.
Further reading
& OPM guidance.
Official OPM survivor benefit guidance, FEHB coverage rules for surviving spouses, and insurance rating tools for evaluating private alternatives.