Disabled Veterans: Free Life Insurance For 100% Rating?

Life insurance is a way to help protect the future of your loved ones. Veterans and their families can access life insurance policies through the Department of Veterans Affairs, including those who are disabled. Veterans with service-connected disabilities can apply for Veterans Affairs Life Insurance (VALife), which provides low-cost coverage of up to $40,000. VALife is available to veterans aged 80 or younger with any level of service-connected disability and, in certain cases, to those aged 81 or older.

Veterans Affairs Life Insurance (VALife)

Veterans aged 81 or older may also be eligible for VALife if they meet the following requirements:

• They applied for VA disability compensation for a service-connected disability before turning 81 years old.
• They received a rating for that same disability after turning 81.
• They apply for VALife within two years of getting the disability rating notification.

The cost of VALife depends on the veteran's age when they apply and the amount of coverage they want. The premium rate will not increase as long as the policy is maintained. VALife does not offer premium waivers or coverage for spouses or dependents of eligible veterans.

The benefits provided by VALife include:

• Up to $40,000 in whole life insurance coverage.
• Cash value that starts accumulating two years after the application is approved.
• Automatic approval of the application if the eligibility requirements are met, without the need to prove good health.
• The ability to maintain coverage for life.
• If the veteran passes away during the two-year waiting period, their beneficiaries will receive the total amount paid in premiums, plus interest.
• If the veteran passes away after the two-year waiting period, their beneficiaries will receive the full coverage amount of the policy.

Service-Disabled Veterans Life Insurance (S-DVI)

Under certain conditions, the basic S-DVI policy offers a premium waiver for veterans who are totally disabled. However, if you have supplemental S-DVI coverage, you will need to pay premiums even if you have a waiver for basic S-DVI premiums. It is important to note that the supplemental S-DVI program also stopped accepting new applications after December 31, 2022.

If you are an S-DVI policyholder, you have the option to switch to the new Veterans Affairs Life Insurance (VALife) program, which began accepting applications on January 1, 2023. VALife offers coverage for veterans with service-connected disabilities and provides up to $40,000 in whole life insurance coverage, available in $10,000 increments. This program does not offer premium waivers or coverage for spouses or dependents of eligible veterans.

If you apply for VALife before December 31, 2025, you can retain your S-DVI coverage during the 2-year waiting period for VALife benefits. Once your full VALife coverage starts, your S-DVI policy, including any premium waivers, will end, and you will need to pay premiums for both policies during the waiting period. If you apply for VALife on or after January 1, 2026, your S-DVI policy will end upon approval of your VALife application, and you will only need to pay VALife premiums during the waiting period.

Veterans Group Life Insurance (VGLI)

Veterans' Group Life Insurance (VGLI) is a program that allows veterans to maintain their life insurance coverage after leaving military service, provided they continue paying the premiums. The eligibility criteria for VGLI are as follows:

• The veteran had part-time Servicemembers' Group Life Insurance (SGLI) as a member of the National Guard or Reserve and suffered an injury or disability that disqualified them for standard premium rates while on duty or travelling directly to or from duty.
• The veteran held SGLI while in the military and is within one year and 120 days of being released from an active-duty period lasting 31 or more days.
• The veteran is within one year and 120 days of retiring or being discharged from the Ready Reserve or National Guard.
• The veteran is within one year and 120 days of assignment to the Individual Ready Reserve (IRR) or Inactive National Guard (ING), including the United States Public Health Service Inactive Reserve Corps (IRC).
• The veteran is within one year and 120 days of being placed on the Temporary Disability Retirement List (TDRL).

VGLI provides term life insurance benefits ranging from $10,000 to $500,000, based on the amount of SGLI coverage the veteran had upon leaving the military. Veterans can increase their coverage by $25,000 every five years, up to $500,000, until they turn 60. To obtain VGLI benefits, veterans must apply within one year and 120 days of leaving the military. If they apply within 240 days of discharge, they are not required to provide proof of good health; otherwise, they must submit evidence of their health status.

VGLI premium rates are determined by the veteran's age and desired insurance coverage amount. Veterans can choose their beneficiaries and modify them as needed, either by accessing their policy online or by submitting a VGLI Beneficiary Designation form. Additionally, VGLI coverage can be converted to an individual insurance policy at standard premium rates without requiring health status proof.

Servicemembers' Group Life Insurance (SGLI)

Eligibility

You may be eligible for full-time SGLI coverage if you meet at least one of these requirements:

• You're an active-duty member of the Army, Navy, Air Force, Space Force, Marines, or Coast Guard.
• You're a commissioned member of the National Oceanic and Atmospheric Administration (NOAA) or the U.S. Public Health Service (USPHS).
• You're a cadet or midshipman of the U.S. military academies.
• You're a member, cadet, or midshipman of the Reserve Officers Training Corps (ROTC) engaged in authorized training and practice cruises.
• You're a member of the Ready Reserve or National Guard, assigned to a unit, and scheduled to perform at least 12 periods of inactive training per year.
• You're a volunteer in an Individual Ready Reserve (IRR) mobilization category.

If you're in nonpay status with the Ready Reserve or National Guard, you may still be eligible for full-time SGLI coverage if you meet both of the following requirements:

• You're scheduled for 12 periods of inactive training for the year.
• You're drilling for points rather than pay.

Benefits

If you qualify for SGLI, you'll be automatically signed up through your service branch. Some of the benefits you can get include:

• Coverage up to the top limit of $500,000—in $50,000 increments.
• 120 days of free coverage from the date you left the military.
• Extension of free coverage for up to 2 years (if you're totally disabled) when you leave the military.
• Part-time coverage (if you're a Reserve member who doesn't qualify for full-time coverage).

Cost

If you have SGLI coverage, you'll pay a monthly premium that will be automatically taken out of your base pay. The current basic SGLI premium rate is 6 cents per $1,000 of insurance coverage, including an additional $1 per month for Traumatic Injury Protection coverage (TSGLI). For example, if you have $100,000 of coverage, your monthly premium will be $7 ($6 for the basic premium plus $1 for TSGLI).

Managing Your Coverage

You can choose your level of coverage or even refuse coverage completely. You can also choose your beneficiaries (the people you pick to receive the money from your life insurance policy if you die) and change them as needed. To make changes to your beneficiaries or coverage level, you can submit your changes online through the SGLI Online Enrollment System (SOES).

Veterans Mortgage Life Insurance (VMLI)

• Have a severe disability that was caused or made worse by their military service.
• Have received a Specially Adapted Housing (SAH) grant to buy, build, or modify a home to live more independently. This includes modifications such as installing ramps or widening doorways.
• Hold the title of the home.
• Have a mortgage on the home.
• Be under 70 years old.

VMLI offers up to $200,000 in mortgage life insurance, which is paid directly to the bank or lender that holds the mortgage. The amount of coverage equals the outstanding mortgage balance but does not exceed $200,000. It's important to note that VMLI is a decreasing-term insurance, meaning that the coverage amount decreases as the mortgage balance is paid off. If the mortgage is fully paid off, the VMLI coverage will end. Additionally, VMLI does not offer any loan or cash value, nor does it pay dividends.

To apply for VMLI, veterans must first apply for an SAH grant. If approved for the SAH grant, the loan guaranty agent will inform the veteran of their eligibility for VMLI. The agent will then assist the veteran in filling out the necessary forms, including the Veterans' Mortgage Life Insurance Statement (VA Form 29-8636). It is important to note that veterans must apply for VMLI before their 70th birthday. The VMLI premium is calculated based on the current mortgage balance, the number of remaining mortgage payments, and the required VMLI coverage amount.

VMLI provides valuable protection for eligible veterans and their families, ensuring that their loved ones are not burdened by the mortgage in the event of the veteran's death.

Frequently asked questions