Understanding VGLI

Veterans’ Group Life Insurance (VGLI) becomes available to servicemembers who were covered by SGLI while on active duty once they separate from service. VGLI provides up to $500,000 of coverage to veterans – with their initial amount tied to the amount of SGLI coverage they had while active (e.g., an active duty servicemember with $50,000 of SGLI is initially eligible for only $50,000 of VGLI; one with $500,000 of SGLI is eligible for the full $500,000 of VGLI). The one caveat to coverage is that veterans must apply for VGLI within one year and 120 days of leaving the military. After this period of time passes, veterans are no longer eligible for coverage.

What makes VGLI especially appealing is that, if a veteran applies for VGLI within 240 days of separation or retirement, no proof of insurability or medical underwriting is required. Veterans who apply between 240 days and one year and 120 days of separation may be required to undergo a medical exam; their health status will be taken into consideration, and they may not be approved. The first 240 days of VGLI eligibility, then, are exceptionally important for veterans who are considering VGLI coverage and may have service-connected disabilities. Because life insurance is a health-based product, a civilian insurance company could choose to deny coverage to an individual with preexisting conditions. VGLI provides these individuals who may not otherwise be eligible for coverage a window during which they can get life insurance.

How much coverage is available?

Veterans are initially eligible for VGLI coverage in an amount equivalent to their SGLI coverage while in the service. On their one-year anniversary of getting VGLI, and every five years thereafter, however, veterans can increase their coverage amount by $25,000 – up to the $500,000 limit. No proof of good health or medical underwriting is required to increase coverage. However, veterans cannot continue to increase their coverage after they reach age 60.

Veterans are able to decrease their coverage amount or cancel their VGLI coverage entirely at any time.

What does VGLI coverage cost?

VGLI premiums increase every five years, and they depend on both the age of the veteran and the amount of coverage elected. For this reason, costs can vary dramatically over time. A 30-year-old veteran with $500,000 of coverage would pay only $40 per month for their coverage, but by the time that veteran reaches 50 years old, that same coverage would cost $145 per month. By 80, the veteran would be paying $2,200 per month.

Note that, because no medical exam is required, VGLI premiums may be higher than those offered by a commercial insurer to a healthy individual for the same amount of coverage.

However, another benefit of VGLI is that it can be maintained in perpetuity. While it is not technically a form of permanent life insurance, as long as a veteran continues to make their premium payments, they will maintain their coverage. If a veteran goes 60 days without making a premium payment, their coverage will be automatically cancelled.

How does VGLI enrollment work?

SGLI coverage automatically expires 120 days after separation, and VGLI coverage can begin as soon as 121 days after separation, so the sooner a veteran applies for life insurance, the better. This can help them maintain coverage during their transition and avoid going without while they decide what coverage they would like to maintain in the future.

Veterans must submit their applications within 1 year and 120 days of leaving the military.

If an application is submitted within 240 days of separation, there is no medical exam. Between 240 days and 1 year and 120 days, a medical exam may be required.

Applications can be submitted in one of three ways:

1. Online through the Office Of Servicemembers Group Life Insurance (via Prudential, who maintains VGLI policies).

2. By completing SGLV 8714: Application for Veterans’ Group Life Insurance and submitting it by fax to 800-236-6142

3. By completing SGLV 8714: Application for Veterans’ Group Life Insurance and submitting it by mail to:
   OSGLI
   PO Box 41618
   Philadelphia, PA 19176

Note that VGLI is not the only choice for separating veterans. All veterans with a disability rating (even 0%) are eligible for Veterans Affairs Life Insurance. Veterans may also choose to convert their SGLI policies directly to a commercial whole life product through participating companies or simply apply for insurance from a commercial insurer.

If a veteran initially chooses a VGLI policy but decides to convert that policy into a specific permanent commercial policy, they can do so at any time without having to undergo a medical exam. Only certain companies offer VGLI conversion, and premium rates may vary by company. Learn more about VGLI conversion here.

Who can be a VGLI beneficiary?

Veterans have free reign to designate the beneficiaries of their VGLI policies. Further, once designated, a beneficiary is not set in stone – VGLI policy owners can update their beneficiaries as dictated by their needs and circumstances. Veterans should consider revisiting their beneficiary designations at regular intervals and after experiencing life changes, including births, deaths, marriages, and divorces.

If a veteran fails to designate a beneficiary and then passes away, VGLI benefits will be paid out in the following order:

• To a surviving spouse, or
• To a child or children equally; if one or more children is deceased, their share(s) will be distributed to their own descendants, or
• To surviving parents, equally, or a surviving parent, or
• To the executor or administrator of the deceased’s estate, or, finally
• To the next of kin under state law.

Beneficiary designations can be made online or by submitting SGLV 8721: VGLI Beneficiary Designation Form to the fax number or address listed above.

How do loved ones file a VGLI claim?

After the death of a veteran, their survivors can file a claim by completing SGLV 8283: Claim for Death Benefits. It can then be faxed to 877-832-4943 or mailed to the OSGLI address listed above. Survivors will be required to furnish a copy of the veteran’s death certificate.