VRS Optional Life Insurance: How to Continue Coverage After Retirement

VRS Basic Group Life Insurance continues automatically after retirement — it reduces on a set schedule, but you do not have to take any action to keep it. Optional Group Life Insurance is different. If you have Optional Life coverage through your employer, you must act within a narrow window to continue it into retirement or lose it permanently.

Basic vs. Optional: Two Separate Programs

Basic Group Life Insurance covers natural death at twice your creditable compensation (rounded up to the next thousand). After retirement, it reduces by 25% each January 1 following one full calendar year of separation, bottoming out at 25% of the original value. If you have 30 or more years of service credit, coverage cannot fall below $9,995 (indexed to the Plan 2 COLA).

Optional Group Life Insurance is coverage you elect and pay for through payroll deductions during active employment. It provides additional death benefit coverage beyond the Basic plan. Your employer must participate in the Optional Group Life Insurance program — not all VRS-participating employers offer it.

The key difference at retirement: Basic coverage continues automatically with the reduction schedule. Optional coverage ends when you separate from employment unless you take action within the conversion window.

The 31-Day Conversion Window

When your Optional Group Life Insurance coverage ends, VRS provides a 31-day window to convert it to an individual policy. The conversion form is Form VRS-39R, available from VRS or your employer's HR office. Confirm the date that starts your conversion period with VRS or HR.

Before converting, review Form VRS-39R and confirm the individual policy's premium and underwriting terms with VRS or the insurer. Do not assume they match the group coverage you had as an active employee.

If you miss the 31-day window, the coverage terminates and the VRS conversion privilege expires. Any replacement individual life insurance would be subject to the insurer's terms and underwriting.

Should You Convert

Whether conversion makes sense depends on your total life insurance picture. Consider these factors:

Your Basic Group Life Insurance continues under its reduction schedule, providing a declining death benefit. If the Basic coverage floor (25% of your pre-retirement amount, or the $9,995 minimum for 30+ year members) is sufficient for your needs, you may not need the additional Optional coverage.

If your spouse depends on your income and your savings and pension survivor protection do not cover the gap, compare the conversion policy's premium and terms with other coverage options, especially if health conditions could affect private insurance eligibility.

If you have already purchased substantial private life insurance or your financial situation does not require additional death benefit coverage, letting the Optional coverage lapse saves you the conversion premium.

Timing It With Your Retirement

The 31-day window is tied to the end of group coverage. If your employment separation date and VRS retirement effective date differ, confirm with VRS or HR which date starts the conversion period. Request Form VRS-39R before your last day of work so you have it in hand.

The VRS Retirement Guide covers both Basic and Optional Group Life Insurance in retirement, including the reduction schedule, the 30-year service floor calculation, and the conversion decision framework.

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