Survivor Benefit Plan Details

The Survivor Benefits Plan (SBP) is an insurance benefit that provides a monthly income (annuity) to any eligible spouse and children when a retired servicemember dies. The SBP covers the insured for his/her entire life, with no age limit. Upon death, it provides an inflation-protected annuity for the life of your surviving spouse or other eligible beneficiary.

The SBP payment depends on the elected base amount ($300/month to the full amount of the monthly retirement pay). The annuity is 55% of the base amount. The SBP is provided at no cost while on active duty, but is offset by any spouse dependency and indemnity compensation (DIC). Active duty-deaths are considered totally disabled, which means that retirement pay is based on 75% of base pay (subject to retirement plan rules for Final Pay, High 3 or REDUX). Participation is voluntary for retirees with payments made via deduction from retirement pay.

A recent study by the Rand Corporation entitled “An Assessment of the Military Survivor Benefit Plan,” responds to Congress’s request for evaluation of the program’s efficacy and the potential to commercialize the Survivor Benefit Plan (SBP). To read a summary of the report or the entire study, click here.

SBP Payment

  • SBP payments are 55% of the base amount elected.
  • Base amount options range from a minimum of $300.00 up to full retirement pay.
  • A monthly benefit, not a lump-sum payment.
  • Protected against inflation with an annual Cost of Living Adjustment (COLA).

SBP Cost

  • Premiums are paid with pre-tax dollars.
  • Spouse coverage cost is 6.5% of the base amount, elected in dollars per month.
  • Child coverage cost is based on the ages of the retiree and the youngest child and the base amount chosen.
  • All premiums cease upon the death of the retiree.

Coverage Options

You are allowed to make one election from the list below.

  • Spouse
    A Survivor Benefit Plan annuity will only be paid to the spouse and will stop at his/her death.
  • Spouse and Child
    Allows for payment to be made first to the spouse and, in their absence, to children (via a guardian).
  • Child only
    Annuity payments provided to children until age 18 (or 22 if enrolled in school) at which time payments cease.
  • Former Spouse
    Choice may be required by a divorce decree. Individuals who are under a court order to cover a former spouse cannot cover a current spouse.
  • Insurable Interest
    May be used by those with no spouse or children. Payments must be made to a person and the cost is different from the information above. Those interested in this choice need to verify the eligibility rules and review the cost structure.

SBP annuity and premium costs are indexed to retirement pay. Both increase with COLA increases. All premiums cease upon the death of the retiree. The SBP annuity to survivors continues to increase with COLA increases.

Military Survivor Benefit Plan Details

  • Spouse concurrence is required if any base amount less than full retired/retainer pay is elected and/or spouse coverage is not elected.
  • Participation decision is revocable between the second and third year of receiving retirement/retainer pay with spouse concurrence.
  • Participation is paid up after completion of 30 years of payment and attaining age 70.
  • A spouse receiving an SBP annuity becomes ineligible if remarried prior to age 55. Benefits can resume at the death of the new spouse if the marriage ends in divorce.
  • Participants cease paying premiums when:
    • Their children are no longer eligible, which occurs on their 18th birthday (or to age 22 if a student); however, a disabled child is eligible for life.
    • They lose their spouse through death or divorce.
  • An unmarried, divorced, or widow/widower retiree can elect SBP coverage for a new spouse. This coverage becomes effective one year after the marriage.
  • Service members without children at the time of retirement may elect coverage for children within 1 year after the birth or adoption.

SBP Cost Example

Below is an example of the cost and SBP payment benefit for a retiring servicemember with $2,000 in gross monthly retired pay who elects an SBP on the entire amount, which is broken into three different options (spouse/spouse & child/child only).

  Spouse Spouse and Child* Child Only*
Monthly retired pay covered by SBP $2,000.00 $2,000.00 $2,000.00
Monthly cost $130.00 $130.38 $5.40
Retired pay after cost of Survivor Benefits Plan $1,870.00 $1,869.62 $1,994.60
Spouse's survivor benefit (55% of amount covered) $1,100.00 $1,100.00 $1,100.00

* This example is for a 44-year-old servicemember with a 10-year-old child.

Potential Survivor Benefits

Opting Out of SBP

You are required to make your SBP election by your last day on active duty. If you choose not to participate, you will not have another chance to enroll later. Review your life insurance coverage, savings, and investments to ensure that your loved ones will have the financial resources they need to take care of themselves if you die.

Understanding Your Options

Navy Mutual Aid Association has been recognized by the Department of Defense as a resource for counseling and information on the Survivor Benefit Plan. If you need help making your decision – or want to compare your options – contact us to get the expert guidance and assistance you need.