Whole Life Insurance: Is Sgli A Good Option?

Servicemembers' Group Life Insurance (SGLI) is a Department of Veterans Affairs program that provides low-cost group life insurance to all military members. SGLI is a term insurance policy for active-duty service members, reservists, and National Guard members. It offers coverage up to $500,000, with the option to decline or reduce coverage. SGLI also includes Traumatic Injury Protection (TSGLI), providing financial assistance for members and their families in the event of a traumatic injury. After leaving the military, SGLI coverage can be converted to Veterans' Group Life Insurance (VGLI) or an individual insurance policy.

SGLI costs 6 cents per $1000 of coverage

Servicemembers' Group Life Insurance (SGLI) is a term insurance policy for active-duty service members, reservists, and members of the National Guard, among others. It offers low-cost coverage to eligible service members, and the cost of SGLI is 6 cents per $1000 of coverage. This means that for every $1000 of insurance coverage, the premium is 6 cents. The premium is paid monthly and is automatically deducted from the base pay of eligible service members.

The SGLI program includes Traumatic Injury Protection (TSGLI), which provides additional coverage for traumatic injuries. TSGLI carries an extra charge of $1 per month, which is included in the monthly premium. For example, for $400,000 worth of coverage, the monthly premium is $24 ($25 including TSGLI). This makes SGLI an affordable option for service members, especially when compared to commercial life insurance policies.

The cost of SGLI coverage is not dependent on individual factors such as age, gender, or health status, unlike individual life insurance plans bought on the open market. This makes SGLI an attractive option for those who may have pre-existing health conditions or be in an older age group, as they could face higher premiums for private insurance.

SGLI provides valuable financial protection for service members and their families in the event of injury or death. While it may not be sufficient for all families' needs, it is a beneficial starting point for those seeking life insurance coverage during their military service.

SGLI includes Traumatic Injury Protection (TSGLI)

Servicemembers' Group Life Insurance (SGLI) includes Traumatic Injury Protection (TSGLI), which provides automatic coverage for service members with traumatic injuries. TSGLI offers short-term financial assistance to help with expenses related to recovery and rehabilitation. This coverage is available to active-duty members, reservists, National Guard members, those on funeral-honours duty, and one-day muster duty.

To be eligible for TSGLI benefits, individuals must meet specific requirements. They must be insured by SGLI at the time of the traumatic injury and incur a scheduled loss as a direct result. The injury must occur before midnight on the day of separation from the military, and the loss must be experienced within two years of the injury. Additionally, the individual must survive for at least seven full days from the date of the injury.

TSGLI covers a range of traumatic injuries, including limb reconstruction surgeries, inpatient hospital care at critical care and rehabilitation facilities, and transitional care from an inpatient facility to living at home. It provides financial support of up to $100,000 to assist service members during their recovery. The premium for TSGLI is a flat rate of $1 per month, automatically deducted from the base pay for most service members.

It is important to note that TSGLI does not cover self-inflicted injuries, injuries resulting from illegal drug use, or injuries occurring while committing or attempting a felony. To receive TSGLI benefits, individuals need to submit the Application for TSGLI Benefits (SGLV 8600), and in case of a denial, they can appeal by submitting the TSGLI Appeal Request Form (SGLV 8600A).

SGLI coverage for spouses and children

Family Servicemembers' Group Life Insurance (FSGLI) is a life insurance program for spouses and dependent children of military members insured under SGLI.

If you and your spouse are both in the military and participate in SGLI, each of you can be insured under basic SGLI as well as SGLI family coverage for the maximum amount of $400,000 for each spouse. To ensure that both of you have spousal coverage, you must list each other as spouses on your Defense Enrollment Eligibility Reporting System (DEERS) record.

FSGLI provides up to a maximum of $100,000 of insurance coverage for spouses, but it can't be more than the SGLI coverage the service member has. Spouse coverage is issued in increments of $10,000, at a monthly cost that ranges from $0.45 to $4.50 per $10,000 coverage increment based on the age of the spouse. Children are automatically covered under a $10,000 free policy. Dependent children get free coverage.

If you’re the civilian spouse of a service member signed up for full-time SGLI, you’ll automatically be insured under FSGLI. In this case, the premium will automatically be taken from your service member’s pay. If you’re a military spouse and you were married on or after January 2, 2013, you won’t be automatically covered. You’ll need your service member to sign up online through the SGLI Online Enrollment System (SOES).

The service member can reduce, turn down, or cancel spousal coverage by submitting changes online through the SGLI Online Enrollment System (SOES).

You can’t turn down, reduce, or cancel coverage for dependent children. However, coverage lasts until the child is 18 years old, and, in some cases, may be extended if the child is a full-time student between 18 and 22 years old or becomes permanently and totally disabled before turning 18 and is no longer able to support themselves.

SGLI coverage for injuries

Servicemembers' Group Life Insurance (SGLI) is a term insurance policy for active-duty service members, reservists, and members of the military academies and Reserve Officers Training Corps (ROTC). It is provided by the government automatically when joining the military, but individuals can choose to decline this coverage and opt for a different insurance policy.

SGLI includes Traumatic Injury Protection (TSGLI), which provides financial protection in the event of a traumatic injury. This coverage is designed to offer financial assistance to members and their families during the recovery process. The monthly premium for TSGLI is $1, which is included in the total monthly premium deduction for SGLI coverage.

Under SGLI, active-duty members, Ready Reservists, and reserve or guard members are eligible for a traumatic injury benefit ranging from $25,000 to $100,000 if they sustain any of the following injuries:

• Total and permanent loss of sight
• Loss of a hand or foot
• Total and permanent loss of speech
• Total and permanent loss of hearing in both ears
• Loss of thumb and index finger on the same hand by severance at or above the metacarpophalangeal joint
• Quadriplegia, paraplegia, or hemiplegia
• Burns greater than second-degree covering 30% of the body or 30% of the face
• Coma or the inability to carry out activities of daily living due to traumatic injury to the brain

It is important to note that payments for traumatic injury benefits are only made if the individual is insured under SGLI at the time of the injury and when the loss directly results from that injury.

In addition to TSGLI, SGLI provides other benefits, such as coverage up to $500,000 in $50,000 increments, 120 days of free coverage after leaving the military, and the option to extend free coverage for up to 2 years if the individual is totally disabled upon discharge.

SGLI after the service

Servicemembers' Group Life Insurance (SGLI) is a term insurance policy for active-duty service members, reservists, and cadets, among others. It is provided by the government when you join the military, and premiums are deducted from your pay. However, you can choose to decline this coverage and opt for a commercial life insurance policy or a nonprofit organisation's policy.

You will lose your SGLI coverage 120 days after you leave the service. To ensure continued coverage after you separate or retire from active duty, you can purchase an individual plan of term insurance.

Upon separation from service, you have the option to convert your full-time SGLI coverage to term insurance under the Veterans Group Life Insurance (VGLI) program. Alternatively, you can convert it to a permanent insurance plan with a participating commercial insurance company.

Veterans Group Life Insurance (VGLI):

VGLI is administered by the Office of Servicemembers Group Life Insurance and supervised by the Department of Veterans Affairs. You can purchase coverage in increments of $10,000 up to a maximum of $250,000, but not exceeding the amount of your SGLI coverage when you separated from the service. To convert your SGLI plan to a VGLI plan, you must submit an application to the Office of Servicemembers Group Life Insurance within 120 days of separating from active duty. VGLI will become active on the 121st day or when the premium is received by the SGLI office.

It is important to note that you can participate in both SGLI and VGLI as long as the combined amount does not exceed $200,000.

Converting to a Permanent, Individual Insurance Policy:

When you leave the military, you can also choose to convert your SGLI coverage to a permanent, individual insurance policy (like whole life) within 120 days from your date of discharge. This can be done without proof of good health, and a list of participating companies can be found on the official website.

SGLI Disability Extension:

If you are totally disabled at the time of your discharge and unable to work, or if you have certain qualifying conditions, you may be eligible for an SGLI Disability Extension (SGLI-DE). This allows you to keep your coverage for up to 2 years after your discharge date at no cost. To apply, fill out the SGLI Disability Extension Application (SGLV 8715) and send it to the OSGLI address listed on the application.

If approved, you will receive a notice 20 months after your separation date informing you that your SGLI-DE will end, and you will have the option to pay a premium for VGLI to continue your coverage.

Frequently asked questions