How Does Military Life Insurance Work?

Military life insurance programs offer service members and their families financial protection against unforeseen circumstances. These specialized options provide support tailored to the unique aspects of military service, helping ensure financial security for those who serve and their loved ones. This coverage is an important component of a comprehensive financial plan for military families.

Understanding Military Life Insurance Programs

Several life insurance programs are available to service members through the Department of Veterans Affairs (VA). Servicemembers’ Group Life Insurance (SGLI) provides low-cost term coverage for eligible service members. It is automatically offered to those on active duty, in the Ready Reserve, or cadets, providing a foundational layer of protection.

Veterans’ Group Life Insurance (VGLLI) is a continuation option for service members after they leave military service. It allows individuals to convert their SGLI coverage into a renewable term policy, ensuring veterans maintain access to affordable life insurance, particularly if health conditions developed during service might make private insurance difficult to obtain.

Family Servicemembers’ Group Life Insurance (FSGLI) extends coverage to the spouses and dependent children of service members insured under SGLI. This program helps provide financial protection for military families.

Traumatic Injury Servicemembers’ Group Life Insurance (TSGLI) is an automatic supplemental coverage for service members under SGLI. It provides financial support to individuals who experience certain traumatic injuries while serving, whether on or off duty, assisting with recovery and rehabilitation expenses.

Eligibility, Coverage, and Premiums

Servicemembers’ Group Life Insurance (SGLI) is available to active-duty service members, Ready Reserve members, and cadets. Most eligible service members are automatically enrolled for the maximum coverage amount. Coverage is available in increments of $50,000, up to a maximum of $500,000. The premium for SGLI is a flat rate of $0.05 per month for every $1,000 of coverage, regardless of age, with an additional $1 per month for TSGLI.

Veterans’ Group Life Insurance (VGLI) is available to service members who had SGLI upon separation from service. Eligibility requires applying within one year and 120 days of separation, with guaranteed coverage if applied for within 240 days. VGLI coverage can range from $10,000 to $500,000, matching the SGLI amount held at separation. Premiums for VGLI are calculated based on the veteran’s age and the amount of coverage, with rates increasing as the insured ages.

Family Servicemembers’ Group Life Insurance (FSGLI) covers the spouses and dependent children of service members who have SGLI. Spouses can receive up to $100,000 in coverage, not to exceed the service member’s SGLI amount. Dependent children are covered for $10,000 each. Premiums for spousal coverage are age-based and paid by the service member, while dependent children are covered at no additional cost.

Traumatic Injury Servicemembers’ Group Life Insurance (TSGLI) is automatically included for all service members covered by SGLI. There is a fixed benefit amount ranging from $25,000 to $100,000, depending on the severity and type of qualifying traumatic injury. The premium for TSGLI is a low, flat rate of $1 per month, which is included in the SGLI premium.

Transitioning Coverage After Service

Service members separating from the military have options to continue their life insurance. The primary method for continuing coverage is converting Servicemembers’ Group Life Insurance (SGLI) to Veterans’ Group Life Insurance (VGLI). This conversion is generally guaranteed, meaning no medical exam or health questions are required if applied for within a specific timeframe. The application window for VGLI is typically within one year and 120 days of separation.

To apply for VGLI, service members generally complete an application form and submit it to the Office of Servicemembers’ Group Life Insurance (OSGLI). The amount of VGLI coverage available cannot exceed the SGLI coverage held at separation. Veterans can elect to increase their VGLI coverage in $25,000 increments every five years, up to the maximum, until age 60, without providing proof of good health.

Service members also have the option to convert their SGLI to an individual commercial life insurance policy. This conversion can be done with participating commercial companies without needing a medical examination, provided the conversion occurs within 120 days of separation. This option allows individuals to transition to a permanent life insurance plan outside of government programs. Many private insurers offer policies tailored to veterans, some without war clauses.

Designating Beneficiaries and Filing Claims

Properly designating beneficiaries is important to ensure life insurance benefits are distributed according to an individual’s wishes. For SGLI, beneficiaries are typically designated through official military channels, often via the SGLI Online Enrollment System (SOES). It is important to name both primary and contingent beneficiaries, and to regularly review and update these designations, especially after major life events such as marriage, divorce, or the birth of children.

For VGLI, beneficiaries are generally designated directly with the Department of Veterans Affairs (VA) or the administering insurance company. Keeping beneficiary information current prevents potential delays or disputes in benefit payouts.

Filing a claim for military life insurance benefits involves specific procedures depending on the program. For death benefits under SGLI, VGLI, or FSGLI, the beneficiary typically needs to submit a claim form along with a certified copy of the death certificate. The necessary forms and detailed instructions are usually available on the VA’s official website.

For Traumatic Injury SGLI (TSGLI) claims, specific medical documentation proving the qualifying injury and loss is required. The application for TSGLI benefits (SGLV 8600) outlines the detailed criteria and documentation needed. After submission, the claim is reviewed to determine eligibility and the appropriate benefit amount, with payment typically made directly to the service member.