There are several life insurance programs that are provided by the U.S. Department of Veterans Affairs (VA). These insurance programs are offered to service members both during and after their time serving in the armed forces. Each life insurance program will include various eligibility requirements as well as its own application process. For example, some plans may include coverage that depends on the veteran’s age, medical status and specific needs.
The cost of the insurance plan can also vary significantly between applicants and programs as some VA programs may waive monthly premiums for eligible applicants while other programs may increase premiums once every few years.
It is important that you review the various types of life insurance policies and programs that may be available to you in order to determine the plan that will fit your needs. It is also worth knowing that some of these insurance programs provide financial security to veterans who are injured while serving and that some programs may also extend coverage to your spouses and dependent children.
Servicemembers’ Group Life Insurance (SGLI)
Provided by the VA, the Servicemember Group Life Insurance (SGLI) program offers low cost insurance to qualifying service members. SGLI automatically enrolls qualifying members, however, service members are permitted to decline coverage or request changes in order to better suit their needs.
In order to qualify for the Servicemember Group Life Insurance program, you must meet one of the following qualifications, as set forth by the Veterans Affairs department:
- You must an active duty member of the Army, Navy, Air Forces, Marines or Coast Guard.
- You must be in the U.S. military academy as a midshipman or a cadet.
- You must be a member of the National Oceanic and Atmospheric Administration (NOAA) or the U.S. Public Health Service (USPHS).
- You must be a volunteer for a mobilization category in the Individual Ready Reserve (IRR).
- You must be in the Reserve Officers Training Corps (ROTC) as a cadet midshipman, or member whom has participated in authorized training and practice cruises.
- You must be scheduled to perform at 12 periods of inactive training each year as a member of the Ready Reserve or the National Guard.
Generally, SGLI provides qualifying service members with free coverage for 120 days beginning from the date of the qualifying member’s separation from the armed forces. However, this coverage can be extended for two years if the veteran is disabled at the time of separation.
SGLI provides a maximum amount of coverage of $400,000 through this plan, however, the VA department supplies benefits in increments of $50,000. Premium costs may vary, but typically, the VA will deduct the amount from a service members’ base pay at a rate of seven cents per $1,000. Any service member that wishes to obtain additional coverage options, such as coverage for traumatic injuries, may do so at a rate of an extra $1 per month.
The SGLI program offers a subprogram that includes coverage to the families of service members. Coverage amounts can vary with a maximum of $100,000 allotted to spouses of service members and $10,000 for each dependent child that a service member may have.
If you are interested in the Servicemember Group Life Insurance program, it is worth knowing that the application procedure for this plan will vary based upon your military branch. Therefore, you are strongly recommended to review all the application methods and requirements associated with your branch before submitting an application.
Veterans Group Life Insurance (VGLI)
So long as you were not dishonorably discharged from the service, you will become eligible for the Veterans Group Life Insurance (VGLI) program. So long as a veteran continues to pay the required monthly premium for the program, coverage levels are around the same amount as what a veteran had or was eligible for while participating in the SGLI program. However, it is worth knowing that veterans will have the option of upgrading coverage amounts, should they choose to do so, once every five years until the veteran reaches the age of 60. The maximum amount of coverage that the VGLI program can provide is $400,000.
To be considered eligible for VGLI, a veteran must only meet a set of requirements that have been set forth by the VA regarding a veteran’s release from active duty. Not only must a veteran have been discharged from the service honorably, but veterans must apply for VGLI within one year and four months from the date of discharge from the service in order to qualify. If a veteran applies for coverage after that initial period, the veteran will be subject to additional eligibility requirements regarding health and medical history.
VGLI premium costs are established based upon the age of the veteran. For example, veterans who are between the age of 40 and 44 can obtain a policy with a $68 premium and a maximum coverage amount of $400,000. However, veterans who are 75 years of age or older would be required to pay a premium of $1,840 for the same level of coverage. VGLI applications can be submitted online, by mail or through the VA portal.
Service-Disabled Veterans Life Insurance (S-DVI)
The U.S. Department of Veterans Affairs offers health insurance policies that are specifically designed or disabled veterans who have a service-related injury. To qualify for the Service-Disabled Veterans Life Insurance (S-DVI) program, you must meet all of the following conditions:
- You must be in good health aside from your service-related condition.
- You must be rated for a disability linked to your service.
- You must have been honorably discharged from active duty after April 25th, 1951.
S-DVI premium rates are determined by age and plan specifics. Generally, premiums will increase every few years with older veterans paying the highest amounts in premiums. In a case of a total disability resulting from the service a veteran provided, the VA will sometimes waive premiums altogether as well as make the totally disabled veteran eligible for additional coverage levels of up to $30,000.
Veterans Mortgage Life Insurance (VMLI)
If you have a severe service-related disability, you may qualify for the Veterans Mortgage Life Insurance (VMLI) program. Through this VA program, mortgage insurance would assist your family in paying a home mortgage in the event of your death. Coverage provides up to $200,000 and includes the costs of construction loans, refinanced mortgages and second mortgages. This type of insurance does not require you to name a beneficiary and coverage amounts can only be paid to the mortgage lender.
It is also worth knowing that the mortgage life insurance policy can be extended to cover a new home, so long as you sold your previous home after obtaining the insurance plan. You will lose coverage beneath this policy if you lose the title to your home or if your mortgage is paid in full.
VMLI premiums can vary between applicants as the Department of Veterans Affairs will consider a number of factors when determining a premium amount, including the age of the veteran, the length of the mortgage and outstanding balances on the mortgage, when applicable. It is also important to know that veterans must submit an application before the age of 70 in order to qualify as well as meet additional requirements regarding the home mortgage.