posted: Apr. 22, 2012 @ 9:35a
I have read Link and Link but need some more guidance. I removed my original post in the thread at OP request and started my own. Plus I know there are quite a few federal employees on this forum so it could help them as well.
I'm actually looking to get a new supplemental policy for myself and would like some opinions. Some background: 24yr GS-12 federal employee 68809/yr. FERS disability coverage is 60% first year and 40% after. I currently live with my brother and just one of our income is enough to support the whole household. However even on my own I can live off 40% after some cuts (retirement, newish car, entertainment) although I would like the extra for quality of life plus actually put something towards retirement. I currently have AICPA plan (4000 month) which I know is not good and am looking to maybe replace it with something else.
I found two options:
First is this group plan for federal employees called FedAdvantage. Information can be found in the following links:
I'm considering the Premier Plan with 70% income replacement to 65 after 90 day waiting period. It has FERS and SSDI offsetting rules. Inflation protection is included under premier. Plan is also guaranteed issue (although I have no health issues).
Disability definition is:
You are unable to earn:
During the Elimination Period and the next 24 months of Sickness or accidental injury, morethan 80% of Your Predisability Earnings at Your Own Occupation for any employer in Your Local Economy; and
after such period, more than 60% of Your Predisability Earnings from any employer in Your Local Economy at any gainful occupation for which You are reasonably qualified taking into account Your training, education and experience.
Mental coverage limited to 24 months except for schizophrenia, dementia, and organic brain disease are not limited.
Residual Coverage. From what I understand 77% minus earned income for first 24 months and 77% minus 50% of earned income after(100% max).
Cost is based on income(I plan to retire at 57 or earlier). Under 35: .0038 35-45: .0057 45-55: .0106 55+: .129
So for me initial cost is $22 a month and as high as $74 (assuming they don't raise rates which I know they can) with an average of $40 over 32 year planned career.
The other option is two separate Guardian Provider Plus policies I got quoted for. It is to age 65 with residual disability and COLA.
It is a $1250/month (Approx 20%) 90 day wait at $34/month and a $900/month (Approx 15%) 365 day wait at $23/month for total of $57 month.
Plan is guaranteed and non cancellable unlike the previous and true own occupation with no offset rules or limit on mental disorders.
I don't think the residual disability is as good. First 12 months it's replacement of lost income but after benefit is proportionate to loss of income. So say if I'm 50% disabled then first 12 months I get the full 35%(amount I'm insured) but after I get only 17.5% from my understanding. So I will have 85% income first year and 67.5 after.
My understanding of the fedAdvantage plan is that I will have 77% of income first 2 years and and 100% after.
Guardian is more portable (don't plan to leave federal job though) but fedAdvantage will keep up to income increases (at increase costs).
Help me decide please.