Veterans Group Life Insurance (VGLI) is a crucial insurance program for former military personnel. It allows ex-members of the armed forces to continue the group life insurance coverage they had during their active service. With VGLI, veterans can maintain financial security and peace of mind, ensuring that their loved ones are protected even after their military service has ended.
Eligibility Requirements
To be eligible for VGLI, veterans must meet specific criteria:
- Must have been insured under Servicemembers’ Group Life Insurance (SGLI) prior to separation.
- Application must be completed within one year and 120 days from discharge.
- Must have a character of discharge that is not dishonorable.
Benefits of VGLI
VGLI offers several significant benefits:
- Coverage Continuation: It provides seamless transition from SGLI to VGLI.
- Coverage Amounts: Veterans can choose coverage amounts ranging from $10,000 to $400,000, in $10,000 increments.
- Premiums: Premiums are based on the veteran’s age and increase as the policyholder ages.
- Convertible: VGLI can be converted to an individual civilian life insurance policy without proof of good health.
Application Process
The application process for VGLI is straightforward:
- Apply Online or by Mail: Veterans can apply online through the Department of Veterans Affairs website or by mailing completed forms.
- Medical Information: No medical exam is required if the application is submitted within 240 days of discharge. After this period, proof of good health may be necessary.
- Premium Payments: Initial premiums are collected at the time of application, with ongoing premiums paid monthly, quarterly, semiannually, or annually.
Key Considerations
When considering VGLI, veterans should keep in mind:
- Age-based Premiums: Premiums increase significantly with age, so it’s essential to plan accordingly.
- Conversion to Civilian Policy: VGLI holders have the option to convert their term policy to a civilian whole life insurance policy, which provides lifelong coverage and builds cash value.
- Beneficiaries: Policyholders can name beneficiaries and change them as needed.
Historical Context
VGLI was established under the Veterans’ Reinsurance Service Act of 1974. Recognizing the need for continued life insurance coverage after military service, Congress enacted this program to provide support and financial stability for veterans transitioning to civilian life.
Comparisons
- VGLI vs. SGLI: SGLI is provided during active service, whereas VGLI continues after discharge. Coverage amounts and premiums differ, with VGLI generally being more costly due to age-based premiums.
- VGLI vs. Civilian Insurance: VGLI offers guaranteed acceptance for veterans, a significant advantage over civilian policies requiring medical underwriting.
Related Terms
- Servicemembers’ Group Life Insurance (SGLI): Group life insurance for active-duty service members.
- Whole Life Insurance: A type of permanent life insurance offering lifelong coverage and cash value accumulation.
- Term Life Insurance: Life insurance covering a specific term, without cash value.
FAQs
Can I increase my VGLI coverage later?
Does VGLI have any cash value?
What happens if I miss a premium payment?
References
- Department of Veterans Affairs website
- Veterans’ Reinsurance Service Act of 1974
- Financial Planning publications on Military Benefits
Summary
Veterans Group Life Insurance (VGLI) provides a valuable option for former military members to continue their life insurance coverage post-service. It ensures that veterans and their families have financial protection and flexibility during their transition to civilian life, with an easy application process and various coverage choices. Understanding the benefits, application requirements, and potential advantages over other life insurance options can help veterans make informed decisions about their financial future.
