Military personnel transferring to the civilian world will have many tasks to complete. One of these is getting a life insurance plan. Sevicemembers on active duty have the SGLI (Servicemembers’ Group Life Insurance) which is a program of low cost coverage. It is also available to ready reservists, National Guard members, and a few other groups. But prior military will have to choose a new coverage plan once they make the transition out of the military.
Veterans’ Group Life Insurance (VGLI)
The VGLI is a program for post separation insurance. It allows Servicemembers to convert their SGLI coverage to a renewable term insurance plan. It can be issued in multiples of $10,000 up to a total of $400,000. Application can usually be done online, and the process is relatively simple. Application must start within one year and 120 days from discharge. Those who do not submit within 120 days will have to provide evidence of good health.
Many people choose VGLI. But, VGLI rates tend to increase every 5 years. Premium rate for people below the age of 29 for a $400,000 plan is $32.00 a month. A full chart of their rates can be found on the VA website.
Army and Air Force Mutual Aid Associaton (AAFMAA)
Another option for separating service members is the AAFMAA. They can provide insurance coverage at varying rates, often cheaper, than that of the VGLI. Though it may not be for everyone, competition and rate comparison can often lead to better decisions.
The AAFMAA program can be a little restrictive compared to the VGLI.
From their website:
MEMBERSHIP ELIGIBILITY
- Army, Air Force, Navy, Marine Corps, Coast Guard personnel who are:
- Active Duty (or within 120 days after separation)
- Guard or Reserve (Full or Part Time)
- USMA, USAFA, USNA, or USCGA Cadets
- ROTC Contract/Scholarship Cadets
- Army, Air Force, Navy, Marine Corps or Coast Guard Retirees (through age 65)
- Honorably discharged Veterans residing in Florida, Hawaii, Maryland, North Carolina, Oklahoma, South Carolina and Virginia
LIFE INSURANCE ELIGIBILITY
- Members and spouses (age limits are dependent upon product selected)
- Children and grandchildren 6 months through age 17 (whole life only)
- Children and grandchildren ages 18-23 (whole life and Level Term I)
- Widows of members (for themselves and children/grandchildren of member)
- Children 15 days through age 13 (Generations Plus)
Compared to other life insurance providers such as Metlife, Prudential, New York Life, and others, the rates and coverage amounts are hard to beat. Multiple states provide various amount, such as florida’s rates for term life. Any individual looking for term life insurance should check with companies to get rate quotes before making a decision.
Partners: IZG, The Daily
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[...] Website for more information on loans and other VA services. Veteran benefits such as VGLI (Veterans Group Life Insurance), GI Bill, and other services are always available to those [...]