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Life Insurance

CHAPTER 12. Veterans' Group Life Insurance

12.01 General Information
12.02 Persons Eligible to be Insured
12.03 Time Allowed to Apply for VGLI
12.04 Effective Date
12.05 Payment of Premiums
12.06 Application for VGLI When a Member is Incompetent
12.07 Beneficiaries and Method of Payment of Insurance Proceeds
12.08 Accelerated Benefits Option
12.09 Conversion to an Individual Policy
12.10 Death Claims
12.11 Lapse and Reinstatement
12.12 Renewal
12.13 VGLI Legislative History

12.01. General Information

a. Veterans' Group Life Insurance (VGLI) is a program of post-separation insurance which provides for the conversion of SGLI to renewable term coverage. VGLI provides up to a maximum of $400,000 of insurance coverage.

b. Persons insured in the VGLI program, like SGLI, are insured under the provisions of a group life insurance policy purchased from a commercial life insurance company by VA. The program is administered by the OSGLI (see paragraph 1.01b for address) and is supervised by VA.

c. The group coverage does not contain any restriction on or require any additional premium for military service. It provides for life insurance but not disability or other supplementary benefits. VGLI has no cash, loan, paid-up or extended insurance values and does not pay dividends.

d. At the end of each term period, the insured has the right to renew coverage for another term period. A member may convert such insurance to an individual policy with any one of the participating companies at any time.

e. When initially applied for, VGLI is issued in $10,000 increments up to a maximum of $400,000, but not for more than the amount of SGLI the member had in force at the time of separation. . If an individual declines VGLI or elects an amount less than the amount of SGLI held while on duty, he or she may later apply for VGLI or for an increase in coverage up to the amount of SGLI held, without evidence of good health, if application is made to the OSGLI within 240 days of release from active duty, if the member was released on or after November 1, 2012, or within 120 days if the member separated from service before November 1, 2012. Application for insurance or an increase in the amount of coverage may also be made through 1 year and 120 days from separation, however, evidence of good health may be required. Subsequently, an eligible individual may request an increase in coverage in multiples of $25,000 without proof of good health.

f. The Veterans’ Benefit Act of 2010 (Public Law 111-275) allows for individuals with current VGLI insurance to increase the amount of their coverage in increments up to $25,000 without proof of good health under the following guidelines:

(1) the request for the additional coverage must be made during the 120-day period prior to the next 5-year VGLI anniversary

(2) the total amount of coverage may not exceed $400,000 upon request for an increase

(3) the individual must be under age 60 on the coverage effective date of the 5-year VGLI anniversary

(4) coverage may continue to be increased on each succeeding renewal up to the maximum of $400,000 and up to age 60

(5) increases less than $25,000 are not allowed if the current coverage amount is $375,000 or less; if the current coverage is more than $375,000, the increase will be the difference between the current amount and $400,000

Applying for the additional coverage may be done online, by calling the OSGLI or by sending a written request to the OSGLI. Once approved, the coverage amount will be increased by $25,000 or the amount the individual is eligible for and premiums will be adjusted accordingly.

g. Individuals who separate from active duty, re-enlist, and effect other changes in their duty status, will become eligible for both SGLI and VGLI coverage and in some cases will become insured under both programs. An individual can be insured under both programs at the same time, provided the coverage does not exceed $400,000, the maximum allowed under the law. Listed below is an explanation of when double coverage may occur and what the member must do to avoid it.

(1) When Double Coverage Occurs

If a member currently insured under VGLI reenters on active duty or active duty for training, he or she becomes automatically covered under SGLI. 

To avoid double coverage the member can:

(a) stop payment of VGLI premiums and elect to be covered under SGLI. These members are entitled to reapply for VGLI upon release or separation, provided their duty was performed under a call or order specifying a period of duty 31 days or longer. If the period of duty is less than 31 days, the member is not eligible to apply for a new VGLI period. However, the member can apply to have his or her VGLI reinstated as outlined in paragraph 12.11.

(b) elect to become insured again under SGLI upon entering a new period of duty and may convert any or all of their VGLI to a commercial policy within 60 days after becoming insured under the SGLI program. If a person dies within the 60-day period and before converting, VGLI will be payable in an amount which, when added to the SGLI, does not exceed the maximum coverage allowed under the law.

12.02 Persons Eligible to be Insured

Persons eligible to be insured in the VGLI program are:

a. SGLI insureds who are being released from active duty or active duty for training under a call or order to duty that does not specify a period of less than 31 days;

b. Members of the Ready Reserves/ National Guard insured under SGLI who are separated, retired, or released from assignment.

c. Individuals who are assigned to the IRR of a branch of service or to the Inactive National Guard (ING). This includes members of the United States Public Health Service Inactive Reserve Corps (IRC). The individual must be able to provide orders showing that he or she is currently assigned to the IRR or ING; or

d. Members who have part-time SGLI and who, while performing duty, suffer an injury or disability which renders them uninsurable at standard premium rates. This includes travel directly to and from duty. NOTE: Members who join the Ready Reserves/National Guard after release from active duty are eligible to continue their SGLI coverage for as long as they remain in the Ready Reserves/National Guard. They are eligible to convert their active duty SGLI coverage to VGLI coverage. As noted in paragraph 12.01(f), "an individual can be insured under both programs, at the same time, provided the combined coverage does not exceed $400,000." (In most instances, these individuals will probably choose to carry the SGLI coverage since it costs less than VGLI coverage.)

12.03 Time Allowed to Apply for VGLI

a. Members with full-time SGLI coverage.

Members who have full-time SGLI coverage will be contacted by the OSGLI, usually within 45-60 days following release or separation from duty. The OSGLI will send the Veteran a pre-printed application for VGLI showing the necessary service data with information about continuing group coverage under the VGLI program. The application is sent to the Veteran's last address of record provided by the Department of Defense. A member who wishes to purchase VGLI and who does not receive this information may apply online through eBenefits or at www.insurance.va.gov. A member can alsoobtain a non-pre-printed form SGLV 8714, Application for Veterans' Group Life Insurance, from any VA office, by writing to the OSGLI, or online.

(1) No Health Review Application Period

To apply for VGLI without any health review, the member should submit an application with the required premium to the OSGLI within 240 days after separation. If the VGLI online application is not used, form SGLV 8714 should be submitted and must be accompanied by a copy of DD Form 214, or other equivalent proof of service.

(2) Health Review Application Period

If the member does not submit the premium and application within 120 days of separation from service (for members separated from service before November 1, 2012) or within 240 days (for members separated on or after November 1, 2012), they may still be granted VGLI if they submit the following to OSGLI prior to 1 year and 120 days from separation):

  • SGLV 8714 and required premium;
  • proof of service or assignment; and
  • proof of good health.

(3) SGLI Total Disability Extension

If the member is totally disabled on the date of separation from service, coverage under the SGLI group policy may continue without charge for 2 years after the separation date or until the insured ceases to be totally disabled, whichever is the earlier date. The member must apply to OSGLI for this extension (See Form SGLV 8715).

(4) Conversion from SGLI Total Disability Extension to VGLI

The member will be automatically billed for VGLI premiums at the end of the SGLI Total Disability Extension.  If the member does not submit the required premium for VGLI within the 2-year period that SGLI is extended after the separation date, the coverage may still be granted provided Form SGLV 8714, evidence of insurability and the initial premium are submitted within 1 year from after the member's SGLI coverage is terminated.

(5) Definition of Total Disability

Total disability is defined as any one of the following:

(a) Any impairment of mind or body which continuously renders it impossible for the insured to follow any substantially gainful occupation

(b) The permanent loss or loss of use of both feet, or both hands, or both eyes, or one foot and one hand, or one hand and one eye;

(c) The total loss of hearing in both ears;

(d) The organic loss of speech. Organic loss of speech means the physiological loss of the ability to express oneself (both voice and whisper) through the normal organs of speech. When such loss exists, the fact that some speech can be produced through the use of an artificial appliance will be disregarded.

NOTE: Members having any of the disabilities listed under subparagraphs 12.03a(5)(b),(c) and (d) above, are considered totally disabled regardless of employment. Members having other disabilities are considered totally disabled only when the disability would prevent the member from engaging in substantially gainful employment. If the member is able to engage in such employment, whether he or she does so or not, the member is no longer totally disabled. Members having the types of disabilities which do not prevent employment, or which are likely to improve so that employment is possible, should not postpone exercising their right to obtain VGLI.

(6) VA Rating Not Required for SGLI Total Disability Extension Eligibility

A member is eligible to apply for an extension based on total disability even if he or she has not received a total disability rating from a VA regional office.

b. Members with part-time SGLI coverage

(1) Members with part-time SGLI coverage do not have the privilege of continuing group coverage under VGLI, unless SGLI is continued in force after the period of duty terminates as a result of disability incurred or aggravated during such duty.

(2) If a member believes that he or she qualifies for VGLI coverage and such coverage is desired, the member should write to the OSGLI well before the end of the 120-day eligibility period. That office will furnish the necessary information on how to obtain VGLI coverage.

c. IRR and ING members

(1) Members of the IRR and ING have one year and 120 days from the date they become members of these organizations to apply for VGLI.

(2) Individuals applying within 120 days of becoming a member of either organization should submit an online application (available through eBenefits or at ww.insurance.va.gov) or a completed form SGLV 8714, Application for Veterans' Group Life Insurance, the initial premium and orders evidencing membership in the IRR and ING to the OSGLI.

(3) If an application and initial premium are not submitted within 240 days of becoming a member of either organization, VGLI may still be granted provided an online application or completed form SGLV 8714, the initial premium, proof of membership and evidence of insurability are submitted to the OSGLI within one year and 120 days from separation.

12.04 Effective Date

a. For members who have full-time SGLI coverage, the effective date for VGLI will be:

(1) The 121st day after such separation or release provided the initial premium is mailed or otherwise delivered to the OSGLI on or before the 120th day after separation or release;

(2) The day following the end of the 2-year period, if the member is totally disabled on the date of separation, or the day following the date that total disability ends, whichever is earlier, but in no event will VGLI become effective prior to the 121st day after separation. An acceptable application and the initial premium must be received in OSGLI prior to the end of the 2-year period following separation.

(3) The date an acceptable application and premium is received at the OSGLI within 1 year following termination of SGLI. (See paragraph 12.03.)

b. For members who have part-time SGLI coverage and during such period of duty suffer an injury or disability which renders them uninsurable at standard premium rates, VGLI coverage will be effective the 121st day after such separation or release. The initial premium and proof of disability must be submitted before the 121st day after such release or separation.

c. For individuals entering the IRR or ING, the effective date will be the date an acceptable application and premium are received in the OSGLI. The application and premium must be received within a year and 120 days after their entry into this status.

12.05 Payment of Premiums

a. Premium payments for VGLI may be made directly to the OSGLI by direct remittance or by allotment from military retirement pay, or as a Deduction From VA Disability Compensation Benefits (DFB).

b. The first premium must be sent directly with the application to the OSGLI even if the applicant desires to pay by allotment or by DFB. Upon approval of the application, subsequent premiums will be due monthly commencing the month after the insurance becomes effective or on the last day of the following month if that month does not have a date corresponding to the effective date.

c. An individual may pay VGLI premiums in advance. Members who pay other than monthly receive a discount. The table below gives an example of the discount received by an insured aged 30-34 with $400,000 coverage whose monthly premium rate is $40.00.

Payment Option Premium (before discount) Discount Rate Premium (after discount) Annual Savings
Monthly $40.00 0.00% $40.00 $0.00
Quarterly $120.00 2.50% $117.00 $12.00
Semi-annually $240.00 3.75% $231.00 $18.00
Annually $480.00 5.00% $456.00 $24.00

d. Upon approval of the application, the OSGLI will send each insured a certificate of coverage. Individuals who have elected to pay directly will receive premium statements either monthly, quarterly, semi-annually or annually. (See Appendix D for the current VGLI Premium Rate Tables.)

12.06 Application for VGLI When a Member is Incompetent

In the case of an incompetent member, the application for VGLI may be made by a guardian, committee, conservator or curator. In the absence of such a court-appointed representative, the application may be submitted by the member's spouse, mother, father, or anyone acting on his or her behalf. In such event, this person should state on the VGLI application the circumstances under which the application is submitted.

12.07 Beneficiaries and Method of Payment of Insurance Proceeds

a. The rules regarding beneficiary designation and the method of payment of insurance proceeds, and Beneficiary Financial Counseling for VGLI are the same as those for members insured in the SGLI program. (See Chapter 6, Chapter 7, Chapter 8, and Chapter 9).

b. When SGLI is converted to VGLI following separation from service, a new beneficiary designation should be made. If the designation is made during a period of time when SGLI is still in effect, the applicant may elect to have the VGLI beneficiary designation become effective immediately to change the SGLI designation. If this election is not made, the VGLI designation will be effective on the first day of VGLI coverage.

However, any designation of beneficiary or beneficiaries for SGLI filed with a uniformed service, until changed, will be considered a designation of beneficiary or beneficiaries for VGLI but not for more than 60 days after the effective date of the insured's VGLI, unless at the end of such 60-day period the insured is incompetent.

If the insured is incompetent, such designation may continue in force until the disability is removed but not for more than 5 years after the effective date of the insured's VGLI. If the insured did not designate a beneficiary for VGLI and death occurs more than 60 days after the VGLI coverage is effective, the proceeds will be paid under the order of precedence in the law (See paragraph 6.06.)

c. To designate a beneficiary for an incompetent applicant, the individual completing the application must submit guardianship papers which authorize the individual to designate beneficiaries on insurance policies. Such a document must be current and in force.

12.08 Accelerated Benefits Option

An Accelerated Benefits Option is available to all terminally-ill insureds under the VGLI program. The rules regarding the program are the same for both the SGLI and VGLI programs and are found in Chapter 5. 

12.09 Conversion to an Individual Policy

a. SGLI coverage in force on the date of release or separation from duty or assignment to the Ready Reserves/National Guard may be converted to an individual policy of life insurance with a commercial company that participates in the program. The conversion privilege must be exercised within the 120-day period following separation or release from duty or such assignment. If SGLI is converted to VGLI, this VGLI coverage can also be converted to a commercial policy that participates in the program at any time after the effective date of VGLI so long as VGLI premiums are paid up to the date of the conversion.

b. VGLI insurance in force can, at any time, be converted to an individual policy of life insurance with a commercial company that participates in the program. A member may either convert his or her coverage to an individual policy or renew it, but cannot take both actions.

c. OSGLI can provide information on how to convert VGLI coverage to an individual policy of life insurance with a list of participating companies.This information may be obtained on the conversion page of this web site, or by contacting the OSGLI.

d. The individual policy will be issued at the standard premium rate regardless of health. The policy can be written on any permanent plan offered by the company. It cannot be issued for an amount greater that the amount of VGLI. It will provide life insurance, but no disability or other supplemental benefits.

e. In the case of an incompetent member, the application for conversion may be made by his or her guardian, committee, conservator or curator. In the absence of such a court-appointed representative, the application may be submitted by the member's spouse, mother, father, or anyone acting on his or her behalf. In such event, this person should state on the conversion application the circumstances under which the application is submitted. The proceeds of such converted policy may be payable only to the member's spouse, children, mother or father, or any other person with an insurable interest.

 12.10 Death Claims

A death certificate must be furnished for all VGLI claims. All death claims for persons insured under the VGLI program must be made to the OSGLI. (See paragraph 12.11 for address.)

12.11 Lapse and Reinstatement

a. VGLI coverage will lapse unless the premium is paid when due or within the grace period of 60 days.

b. If VGLI lapses for failure to pay timely premiums, OSGLI will send the insured notification of the lapse and a reinstatement application form at the last known address of record. The insured may apply for reinstatement at any time within five years of the date of the unpaid premium. If the reinstatement application is submitted within six months of the date of lapse, the insured need only provide evidence that he or she in is in the same state of health on the date of reinstatement as he or she was on the date of the unpaid premium. If the reinstatement application is submitted more than six months after the date of the unpaid premium, the insured must meet good health requirements. The completed reinstatement application should be submitted to:

Office of Servicemembers' Group Life Insurance
P.O. Box 41618 Philadelphia, PA  19176-9913

12.12 Renewal

a. VGLI coverage that is in force will automatically be renewed at the expiration of each coverage period. The premium rate for the new period will be based on the insured's age at the time of renewal and the rate schedule in effect at that time. The premium rate schedule is subject to change. If coverage has lapsed for non-payment of premiums, this coverage must be reinstated, in accordance with paragraph 12.11(b), before renewal will be considered.

b. The maximum amount of coverage that may be renewed is limited to the amount of VGLI in force at the end of the current VGLI period. If the amount of VGLI has previously been reduced, the insured may, within 5 years of the reduction, reinstate the reduced amount of insurance and continue this coverage for the renewal period. The five-year period for reinstatement applies even if it runs into a new term period. For example, if an individual reduced his or her coverage at the beginning of the third year of a term period, he or she may reinstate the reduced amount during the first two years of the next term period. Medical evidence of good health will be required for this reinstatement.

c. Individuals insured under VGLI who are members of the IRR or ING may renew their VGLI if:

(1) Their coverage is in force; and
(2) They are members of the IRR or ING at the time of renewal.

12.13 VGLI LEGISLATIVE HISTORY

a. The Veterans' Group Life Insurance (VGLI) program was created by Public Law 93-289, The Veterans Insurance Act of 1974. The law was enacted May 24, 1974, and was effective August 12, 1974. It allowed Veterans, upon separation, to convert their SGLI to a 5-year non-renewable term policy called VGLI.

b. Public Law 99-166 was enacted December 3, 1985, and became effective January 1, 1986. It extended VGLI coverage to members of the Individual Ready Reserve (IRR) and Inactive National Guard (ING). It also provided that, if individuals remained in the IRR or ING through the 5-year period, they were entitled to renew their VGLI for additional 5-year periods. There was no limit on the number of times they could renew provided they remain in the IRR or ING. At the end of the term period, these insureds had the right to convert their insurance to a permanent plan life insurance policy with one of the companies that participated in the program rather than renewing it.

c. Public Law 102-568, effective December 1, 1992 provided that VGLI in effect on or after the effective date of the law is renewable for additional 5-year periods for all VGLI insureds.

d. Public Law 104-275, effective October 9, 1996, merged Retired Reservists SGLI into the VGLI program and extended VGLI coverage to members of the Ready Reserves who have SGLI coverage and who are released from a drilling assignment. It also provided that individuals with VGLI coverage may, at any time, convert their VGLI coverage to an individual commercial policy, rather than only at the end of a 5-year renewal period.

e. Public Law 105-368, effective February 9, 1999, established an Accelerated Benefit Option for terminally-ill SGLI and VGLI insureds. Under this option, a terminally-ill member may receive in a lump sum payment a portion of the face value of the insurance as an accelerated benefit.

f. Public Law 106-419 increased the maximum amount of SGLI and VGLI coverage from $200,000 to $250,000, effective April 1, 2001.

g. Public Law 109-13 increased the maximum amount of SGLI and VGLI coverage from $250,000 to $400,000, effective September 1, 2005. 

h. Public Law 111-275 allowed VGLI insureds who are under age 60 and have less than $400,000 in coverage to purchase up to $25,000 of additional coverage on each five-year anniversary of their coverage, up to the maximum $400,000, without medical underwriting, effective April 11, 2011.

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