Survivors of some veterans are entitled to their continued Department of Veterans’ Affairs (VA) benefits. The VA and the Department of Defense (DoD) provide survivors’ benefits such as life insurance programs, educational benefits, monthly compensation, and medical care. Financing a home through VA is also a possibility. Surviving family members can qualify for the continued benefits if:
- The service member died on active duty
- The service member died as a result of a service-related medical condition
- The service member is rated as completely and permanently disabled by the VA
Veterans’ Life Insurance Programs
Provided the service member qualifies, they are offered veterans’ life insurance programs through the VA. As a result of military members and veterans having a difficult time enrolling in civilian life insurance programs because of their risk of potential recall and other service-related disabilities and medical conditions, the VA has established a separate system for veterans.
A veteran can opt from various programs contingent on their status.
Servicemembers’ Group Life Insurance (SGLI)
Those of active duty, the Reserves, and the National Guard are automatically enrolled in the Servicemembers’ Group Life Insurance (SGLI) program at the maximum coverage, unless the veteran opts for a lessened amount or no coverage at all in writing.
The current SGLI premium is $0.065 per $1,000 of insurance, regardless of the member’s age, up to a maximum of $400,000 worth of coverage. Therefore the full coverage costs $27 per month.
Click here for up-to-date SGLI rates.
For those with children, as additional bonus coverage of $10,000 is automatically allotted for dependent children of members insured under SGLI. No premium is required.
Coverage for SFLI commonly terminates 120 days after departure from the military. After release from the service those with SGLI coverage have two options:
- SGLI covered members can convert their SGLI coverage to term insurance under the Veterans’ Group Life Insurance program (visit the section entitled “Veterans’ Group Life Insurance”).
- SGLI covered member can convert to a permanent plan of insurance with a participating commercial insurance company.
Here is a list of participating commercial insurance companies.
Through a decision Congress made in 2005, service members with SGLI policies who are completely disabled when they depart from military service are eligible to continue their SGLI coverage for up to two years after their departure free of charge.
Traumatic Servicemembers’ Group Life Insurance (TSGLI)
Traumatic Servicemembers’ Group Life Insurance (TSGLI) pays a monthly premium of $1 and is automatically applied to individuals already enrolled in the Servicemembers’ Group Life Insurance (SGLI). During a time of rehabilitation as a result of traumatic injury, the TSGLI contributes financial assistance to covered members. Depending on the quality and degree of injury, coverage ranges from $25,000 to $100,000.
Here is a list of payments covered by the TSGLI.
Coverage for TSGLI ends when SGLI discontinues 120 days after separation from the military. Visit “Servicemembers’ Group Life Insurance (SGLI)” for more details.
If a service member is enrolled in SGLI, they do not have to apply for TSGLI as they are enrolled automatically.
In order for a deceased service member to be eligible for payment under the TSGLI program, they must have sustained a traumatic injury and survived for at least seen full days from the date of the injury to qualify for the benefits. The beneficiary named by the member on the SGLI application is given the insurance proceeds.
Family Servicemembers’ Group Life Insurance (FSGLI)
Under the SGLI program (“Servicemembers’ Group Life Insurance [SGLI]”), spouses and dependent children of insured service members are eligible for the Family Servicemembers’ Group Life Insurance (FSGLI) program. The FSGLI allocates a maximum of $100,000 of insurance coverage for spouses, not to surpass the amount of SGLI the insured member has, and $10,000 for dependent children.
FSGLI is applicable for family members of individuals currently in the military. Service members can contact their unit or base personnel office to enroll family members in the FSGLI.
Beneficiaries of the FSGLI pay a premium for the benefit. Monthly rates are contingent on the amount of overage selected and the age of the spouse. Read more information on FSGLI monthly rates.
Veterans’ Group Life Insurance (VGLI)
Veterans’ Group Life Insurance (VGLI) is an insurance program available for service members who have separated from the military. VGLI enables a veteran the ability to convert their SGLI coverage to renewable term insurance. Converting SGLI coverage to VGLI must be completed within 485 days of discharging from the military. Those that have converted within 120 days of separation don’t need to provide confirmation of health unless they wait longer to enroll.
Monthly premium rates are contingent on the service member’s age and amount of coverage they oft for. Premiums can range from $0.80 per month to a whopping $1,800 per month. Those over the age of 75 must pay $1,800 per month for the maximum coverage under the VGLI.
Here is a listing of current premiums.
A veteran’s VGLI coverage total can’t surpass the amount of SGLI they had during the time of separation from the military. VGLI coverage is issued in mulles of $10,000 up to $400,000.
At the time of military discharge individuals can apply for VGLI coverage with their unit or base personnel office. Otherwise they can apply online.
VGLI may be advantageous for those who have been medically discharged or retired from the military due to a probable, life-threatening condition because many civilian life insurance plans won’t cover such pre-existing conditions.
Service-Disabled Veterans’ Insurance (S-DVI)
Service-Disabled Veterans’ Insurance (S-DVI) is devised for veterans with service-connected disabilities (visit Chapter 6 for more details concerning service-connected disabilities and disability rating). S-DVI is available as term insurance and in a multitude of permanent plans as well. The maximum amount of coverage is $10,000.
Service members can apply for S-DVI if they qualify for the following standards:
- The veteran was released from active duty on or after April 25, 1951, with a discharge that the VA determines as other than dishonorable (Chapter 2 has information on discharge characterizations).
- The veteran was rated for a service-related disability.
- The veteran is in decent health beside service-related conditions.
- The veteran applied within two years from the date the VA grants their service-related disability.
Monthly premiums are contingent on the service member’s age, the amount of coverage they opt for, and the particular insurance plan they choose. Up-to-date rates are available here.
Veterans can apply for S-DVI by completing a VA Form 29-4364, Application for Service-Disabled Veterans Life Insurance if they are eligible. VA Form 29-4364 is available from VA regional offices (Appendix B has a list of VA regional office locations).
Here is a downloadable VA Form 29-4364.
Veterans’ Mortgage Life Insurance (VMLI)
Veterans’ Mortgage Life Insurance (VMLI) is a life insurance program created to pay of home mortgages of severely disabled veterans in the event of their death.
Veterans who qualify for a Specially Adapted Housing Grant from the VA are also eligible for VMLI, assisting disabled veterans construct or alter a home to provide accommodations for their disabilities.
The total of VMLI coverage is comparable to the amount of the outstanding mortgage balance still owed by the veteran or $90,000 (whichever is the smaller amount). Premiums are contingent on age, outstanding balance of the mortgage owed by the member during the time of application, and the number of years remaining on the mortgage.
To analyze a premium, visit the VA calculator online.
A service member who is eligible for a Specially Adapted Home Grant from the VA also qualifies for the VMLI. To apply the veteran is required to complete VA Form 29-8638, Application for Veterans’ Mortgages Life Insurance. This form is available at any VA regional office (Appendix B) or online here.
Survivor Benefit Program (SBP)
The Survivor Benefit Program (SBP) is regulated by the Department of Defense (DOD). Military members can enroll in the Survivor Benefit Program at the time of retirement. The SBP enables a retiree to forgo 6.5 percent of covered retirement pay each month in premiums and consequently, when the retiree becomes deceased, the surviving spouse or minor children receive an annuity comparable to 55 percent of the covered retirement pay.
Members of the SBP can opt to have any increment covered, up to 100 percent of their military retired pay. For example, if an individual had a military retirement payment of $2,000 per month, they can cover 100 percent of this. This equates to having 6.5 percent of the entire $2,000 ($130) deducted from their retirement pay each month whereas their spouse and children would be given 55 percent of the $2,000 ($1,100) per month when the member becomes deceased.
A member must sign a form to accept or decline the SBP option during their departure from the military for retirement.
For military members that are married and decline the SBP, a spouse must sign as well as evidence of the refusal. If a member and their spouse do not sign a declination, they are automatically enrolled in the SBP. If a spouse remarries before turning 55 they are no longer entitled to SBP payments, but eligible again if the remarriage is terminated.
SBP payments are lessened by any amount of Dependency and Indemnity Compensation received (visit “Dependency and Indemnity Compensation [DIC]”). In order to eliminate the offset, Congress passed the Defense Authorization Act in 2008, creating a new payment entitled the “Special Survivor Indemnity Allowance.”
Surviving spouses eligible for the DIC and SBP are entitled to $50 per month paid by the VA. Unless Congress deems the allowance permanent or ends the offset completely, the monthly allowance is provisioned to expand by $10 a year on October 1 each year through 2012, terminating on February 28, 2016.
Filing a life insurance claim
The VA files claims for service member life insurance programs with the exception of the SBP, which is filed with the DOD.
Veterans’ life insurance claims
Service members interested in veterans’ life insurance programs can file a death claim by completing VA Form 29-4125, Claim for One Sum Payment. VA Form 29-4125 is available at any VA regional office (Appendix B) or you can download VA form 29-4125.
Complete the claim and attach a copy of the death certificate detailing the date and cause of death. Submit the completed claim by faxing it to 800-669-8477 or mail it to:
- Department of Veterans Affairs
- Regional Office and Insurance Center
- P.O. Box 7208
- Philadelphia, PA 19101
Individuals can report the death of a military retiree and make a claim for SBP by contacting the Annuitant Pay section of Defense Finance and Accounting Service (DFAS). The DFAS can be contacted by phone at 800-321-1080 or 216-522-5955; fax at 800-982-8459; or send a request to:
- Defense Finance and Accounting Service
- U.S. Military Annuitant Pay
- P.O. Box 7131
- London, KY 40742-7131