Va Life Insurance: What Veterans Need To Know

Life insurance is a crucial aspect of financial planning, and for veterans, understanding their options is essential. The Department of Veterans Affairs (VA) offers various life insurance programs to cater to the diverse needs of veterans, service members, and their families. These programs provide financial security and peace of mind, ensuring that unexpected costs during difficult times are covered. VA life insurance options include group life insurance during and after military service, short-term financial support for severe injuries, and guaranteed acceptance whole life insurance for those with service-connected disabilities. Additionally, VA provides resources to help individuals determine their eligibility and manage their policies effectively. Understanding these insurance options is a vital step in safeguarding the financial future of veterans and their loved ones.

Veterans' Group Life Insurance (VGLI)

Eligibility

To be eligible for VGLI, you must meet at least one of the following requirements:

• You had part-time Servicemembers' Group Life Insurance (SGLI) as a member of the National Guard or Reserve, and you suffered an injury or disability while on duty that disqualified you for standard premium insurance rates.
• You had SGLI while you were in the military and you're within 1 year and 120 days of being released from an active-duty period of 31 or more days.
• You're within 1 year and 120 days of retiring or being released from the Ready Reserve or National Guard.
• You're within 1 year and 120 days of assignment to the Individual Ready Reserve (IRR) of a branch of service or to the Inactive National Guard (ING). This includes members of the United States Public Health Service Inactive Reserve Corps (IRC).
• You're within 1 year and 120 days of being put on the Temporary Disability Retirement List (TDRL).

Benefits

With VGLI, you can receive between $10,000 and $500,000 in term life insurance benefits, based on your SGLI coverage when you left the military. You can also increase your coverage by $25,000 every 5 years, up to $500,000, until you turn 60.

Application Process

To apply for VGLI, you must do so within 1 year and 120 days of leaving the military. You can apply through the Office of Servicemembers' Group Life Insurance (OSGLI) using the Prudential website or by mail/fax. If you apply within 240 days of leaving the military, you don't need to provide proof of good health. However, if you apply after this period, you'll need to submit evidence of good health.

Premium Rates

VGLI premium rates are based on your age and the amount of insurance coverage you want. You can choose your age group to find the corresponding monthly premium rates as of April 1, 2021.

Beneficiaries

You can choose your beneficiaries and update them as needed. You can access your policy online or by filling out and submitting a VGLI Beneficiary Designation form (SGLV 8721).

Converting VGLI Coverage

You can convert your VGLI coverage to an individual insurance policy by choosing a new insurance company from the list of participating companies and applying at their local sales office. You'll need to provide a VGLI Conversion Notice letter from OSGLI to the agent processing your application. It's important to note that the conversion policy must be a permanent policy, such as a whole life policy, and you cannot convert to term, variable life, or universal life insurance.

Servicemembers' Group Life Insurance (SGLI)

SGLI offers benefits such as coverage up to $500,000 in $50,000 increments, 120 days of free coverage from the date of leaving military service, and part-time coverage for Reserve members who don't qualify for full-time coverage. The current basic SGLI premium rate is 6 cents per $1,000 of insurance coverage, with an additional $1 per month for Traumatic Injury Protection coverage (TSGLI).

Servicemembers can choose their level of coverage or even refuse it entirely. They can also select their beneficiaries and change them as needed. To make changes to SGLI coverage, Servicemembers can submit their requests online through the SGLI Online Enrollment System (SOES).

When Servicemembers leave the military, they can apply for Veterans' Group Life Insurance (VGLI) within one year and 120 days from their date of discharge, for up to the amount of coverage they had through SGLI. They also have the option to convert their SGLI coverage to a permanent, individual insurance policy within 120 days of their discharge without proof of good health.

Family Servicemembers' Group Life Insurance (FSGLI)

Family Servicemembers Group Life Insurance (FSGLI) is a type of insurance offered by the US Department of Veterans Affairs. It provides coverage for the spouses and dependent children of service members who are insured under Servicemembers' Group Life Insurance (SGLI).

Eligibility for FSGLI

To be eligible for FSGLI, the service member must meet one of the following requirements:

• They are on active duty and covered by full-time SGLI.
• They are a member of the National Guard or Ready Reserve covered by full-time SGLI.

Spouses of service members covered under SGLI may qualify for FSGLI regardless of their own status (i.e. active duty, retired, or civilian). Dependent children of service members covered under SGLI are also eligible for FSGLI.

Coverage Amounts and Costs

FSGLI provides up to a maximum of $100,000 in coverage for spouses, as long as it does not exceed the service member's SGLI coverage. Dependent children are covered for $10,000 each, and this coverage is provided at no cost. The service member will pay a premium for spousal coverage, which increases as the spouse ages.

Applying for FSGLI

If the service member is signed up for full-time SGLI, their civilian spouse will be automatically insured under FSGLI, and the premium will be deducted from the service member's pay. If the spouse is military, they will need to be signed up by the service member through the SGLI Online Enrollment System (SOES).

Managing Coverage

Service members can submit changes to spousal coverage, such as reducing or cancelling it, through SOES. Dependent coverage for children cannot be turned down, reduced, or cancelled.

Converting Spousal FSGLI Coverage

Spouses have the option to convert their FSGLI coverage to a permanent, individual insurance policy within 120 days of the service member's separation from the military or their decision to end SGLI coverage. After conversion, the spouse becomes solely responsible for all aspects of the policy, including premium payments.

Traumatic Injury Protection (TSGLI)

TSGLI benefits have been expanded to include limb reconstruction surgeries, inpatient hospital care at critical care facilities, rehabilitation facilities, and skilled nursing facilities, as well as care to help transition from an inpatient facility to living at home (therapeutic pass).

To be eligible for TSGLI, you must meet the following requirements:

• You must be insured by SGLI when you experience a traumatic injury.
• You must incur a scheduled loss, and that loss must be a direct result of a traumatic injury.
• You must suffer the traumatic injury before midnight on the day you separate from the uniformed services.
• You must suffer a scheduled loss within 2 years (730 days) of the traumatic injury.
• You must survive for a period of not less than 7 full days from the date of the traumatic injury.

TSGLI coverage is automatic for service members with full-time SGLI. This includes active-duty members, reservists, National Guard members, those on funeral honours duty, or on 1-day muster duty. The premium for TSGLI is a flat rate of $1 per month, which is automatically deducted from the base pay of most service members.

To file a claim for TSGLI benefits, download and complete the Application for TSGLI Benefits (SGLV 8600). This form can be faxed, emailed, or mailed to the relevant branch of service. If you are denied benefits, you can appeal the decision by reviewing the denial letter and, if instructed, completing the TSGLI Appeal Request Form (SGLV 8600A) within the specified time frame.

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 for more independent living (e.g., installing ramps or widening doorways).
• Hold the title to the home.
• Have a mortgage on the home.
• Be under 70 years old.

VMLI provides up to $200,000 in mortgage life insurance, which is paid directly to the bank or lender that holds the mortgage. The coverage amount equals the outstanding mortgage balance but does not exceed $200,000. It is important to note that VMLI is a decreasing-term insurance, meaning that the coverage amount decreases as the mortgage balance is paid down, and the coverage ends if the mortgage is fully paid off. Additionally, VMLI does not offer loan or cash value and does not pay dividends.

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

Frequently asked questions