United States District Court, D. Massachusetts
FINDINGS OF FACT, CONCLUSIONS OF LAW, AND
B. SARIS CHIEF UNITED STATES DISTRICT JUDGE
Metropolitan Life Insurance Company (“MetLife”)
brings this action against pro se Defendant Eric A. Beard
(“Eric Beard”) to recover benefits mistakenly paid to
him as the son and sole beneficiary of decedent Paul K.
Beard, who maintained life insurance under the Federal
Employees' Group Life Insurance Act
(“FEGLIA”), 5 U.S.C. §§ 8716, during
his employment with the United States Postal Service
(“USPS”). After a bench trial, the Court finds
that Eric Beard was unjustly enriched. Judgment shall
enter for MetLife.
United States Office of Personnel Management
(“OPM”), which has the authority to administer
and regulate the benefits under FEGLIA, purchases master
policies from private life insurance companies such as
MetLife. Pursuant to 5 U.S.C. § 8709, MetLife issued
Group Policy No. 17000-G, known as the Federal Employees'
Group Life Insurance Policy (the “FEGLI Policy”)
to OPM. The Office of Federal Employees' Group Life
Insurance (“OFEGLI”) is the administrative unit
of MetLife charged with administering claims for FEGLI
are two types of life insurance under the FEGLI program:
Basic and Optional. For most federal employees, their Basic
insurance amount is their annual rate of basic pay, rounded
to the next higher thousand, plus $2, 000. The cost of Basic
insurance is shared between the insured individual and the
are three types of Optional insurance under the FEGLI
program. Option A is standard optional insurance of $10, 000.
Option B is additional optional insurance and comes in 1, 2,
3, 4 or 5 multiples of an employee's annual pay (after
the pay has Accordingly, the Court proceeds with an unjust
enrichment analysis and the other claims are waived. been
rounded to the next higher thousand, if not already an even
thousand). Option C is family optional insurance. The federal
employee pays the full cost of any and all Optional insurance
federal employees are automatically enrolled in Basic
insurance; Optional insurance must be specifically elected.
Generally, both Basic and Optional insurance end on the date
the employee separates from service, subject to a 31-day
extension of coverage. Under certain circumstances, an
employee may choose to retain his Basic and Optional
insurance into retirement.
to retirement, a federal employee with insurance coverage
under FEGLI may choose to fill out a “Continuation of
Life Insurance Coverage” form (SF 2818). The form
provides for an employee to choose whether to continue Basic
life insurance, and Options A, B, and/or C if the employee
already has such coverage, into retirement. The form also
provides for the employee to choose to continue coverage but
at various reduced levels. For example, an eligible employee
with Option B or C coverage may choose to discontinue
coverage for retirement, retain and pay for full coverage, or
choose to have the Optional insurance with “Full
Reduction.” “Full Reduction” means that the
employee starts with the full value of his coverage, but the
value reduces by two percent per month for 50 months
beginning in the second month of retirement. There is a 31
day conversion period starting from the day the employee
retires. During this conversion period, the employee
maintains the insurance he had immediately prior to
retirement, before the new selections from the SF 2818 go
employee fails to fill out an SF 2818 prior to retirement,
then there are default provisions. OPM instructs that for
Option B, the default is Full Reduction for all multiples you
are eligible to have in retirement. Again, “Full
Reduction” does not mean the elimination of the
benefit. Rather, it means that the retiring employee starts
with the full value of his coverage, but the value reduces by
two percent per month for 50 months beginning in the second
month of retirement.
MetLife's Claims Process
does not maintain or have access to a federal employee's
paperwork until the employee, or former employee, deceases.
At that point someone from the employee's family usually
contacts OPM to report the death and OPM begins the death
claim process. As part of that process, OPM sends MetLife a
certification indicating what level of coverage the federal
employee had at his time of death (Form RI 76-9), his
designation of beneficiary, and a claim form usually
completed by the person who reported the death (Form FE-6).
It is standard practice for MetLife to receive a death
certificate from OPM before a claim can be processed.
to the FEGLI Standard Contract, MetLife is required to use
“reasonable diligence to ensure that the certification
was properly completed, ” and to “pay Benefits in
accordance with the information on that certification.”
In doing so, MetLife must “rely on all certifications
by OPM and other Government Agencies issued to verify an
Insured Person's eligibility, Insurance in Force, and
Annual Rate of Basic Pay.” MetLife must also attempt to
collect any erroneous payments made under the contract.
Decedent Paul K. Beard
Beard (“Paul Beard”) was an employee of the USPS
for 45 years. Paul Beard had life insurance coverage under
the FEGLI program through his employment with the USPS.
Immediately prior to his retirement on October 1, 2015, Paul
Beard's life insurance coverage included $62, 000 in
Basic insurance (i.e., his $59, 294 salary rounded to the
next higher thousand and adding $2, 000), Option A insurance
in the standard amount of $10, 000, and Option B insurance in
the amount of $300, 000 (i.e., five multiples of his salary
rounded to the next higher thousand).
August 20, 2015, Paul Beard submitted an “Application
for Immediate Retirement” with the date of retirement
listed as October 1, 2015. In preparation for retirement, on
August 28, 2015 he filled out a “Continuation of Life
Insurance Coverage" form (“August SF 2818”).
The form indicated that upon retirement, Paul Beard had
elected to continue Basic life insurance at ¶ 75%
reduction and to continue Option A insurance. It also
indicated that Paul Beard did not want to continue Option B
or C into retirement, but stated that he wished to have both
at Full Reduction. This form was stamped as received by human
resources on September 1, 2015. After it was received,
someone wrote on the form, “If you are not keeping B or
C then just [check] no.” The August SF 2818 was not
part of the claim file provided to MetLife.
Beard filled out, signed, and submitted a second SF 2818 on
September 10, 2015 (“September SF 2818”). The
September SF 2818 indicated that, upon retirement, Paul Beard
intended to continue his Basic insurance and his Option A
insurance, but not his Option B or C insurance.
October 29, 2015, after retiring from the USPS, Paul Beard
signed a “Designation of Beneficiary” form (SF
2823) designating his son, Eric Beard, his sole beneficiary
to the FEGLI benefits. Eric's wife Samantha Beard, and
Samantha's sister, Sarah Mauro, witnessed the
designation. He was competent and not intoxicated at the time
he signed this form.
Beard passed away from natural causes on November 12, 2015.
He died more than 31 days after his retirement from the USPS
on October 1, 2015. Thus, at his time of death he was insured
for Basic life ...