What Happens to SGLI After Leaving the Military?

Servicemembers’ Group Life Insurance (SGLI) is the military’s life insurance option for active-duty service members and is among the most affordable on the market.

Unlike commercial life insurance, all service members pay the same premiums based solely on their elected coverage amount. Currently, $500,000 in SGLI coverage (the maximum amount offered) costs $26 per month, plus an additional $1 for traumatic injury protection.

Traumatic injury protection (TSGLI) provides servicemembers with financial support should they be injured while serving. TSGLI provides up to $100,000 in financial support for service members during their recovery.

TSGLI also covers all service members who have SGLI; premiums for both are automatically deducted from a service member’s pay.

SGLI also has a family component called family SGLI (FSGLI). FSGLI provides coverage to spouses and dependent children of servicemembers under a different cost structure than SGLI.

Dependent children receive up to $10,000 in coverage at no cost. Spouses are eligible for up to $100,000 in life insurance coverage, with premiums that vary based on their age.

For $100,000 of coverage, a spouse can expect to pay between $4.50 and $45 per month. Most active-duty spouses receive coverage for less than $10 per month.

SGLI and FSGLI coverage lasts until a service member changes their election amounts, declines coverage, or leaves military service.

What Happens to SGLI Coverage Upon Separation?

SGLI and FSGLI coverage continues for 120 days after a service member retires or separates from the military. However, a service member loses their TSGLI coverage immediately upon leaving the service.

Here are some options for maintaining life insurance coverage outside of the military.

Apply for an SGLI Disability Extension

You can apply for an SGLI disability extension if you meet certain requirements:

• Experiencing total disability at the time of separation that prevents you from working
• Lost hearing in both ears
• Lost speaking ability
• Unable to use both hands, feet, eyes, or a combination of these disabilities

The extension will grant you coverage for up to two years post-separation if approved. After the extension ends, you can convert your SGLI to Veterans’ Group Life Insurance (VGLI). You can keep VGLI as long as you continue making premium payments.

Convert Your SGLI to VGLI

VGLI may be a good option for veterans with health conditions that could prevent them from obtaining affordable commercial life insurance coverage.

You are eligible to convert your SGLI to VGLI, provided you apply within one year and 120 days of separation. If you apply within 240 days of separation, you will not be required to undergo a medical exam to obtain coverage.

The maximum amount of your initial VGLI coverage cannot exceed your SGLI coverage at the time you separate. However, you can increase your VGLI coverage by $25,000 every five years until you turn 60. The maximum VGLI policy is $500,000.

You can apply for VGLI online through the Office of Servicemembers’ Group Life Insurance or by mail or fax.

VGLI costs more than SGLI. Your age and the amount of coverage determine your VGLI premium, so premiums increase every five years. VGLI premiums vary by age and coverage amount and are updated periodically — check the current rate table on VA.gov before estimating your cost. As long as you pay your premiums on time, VGLI will not expire.

Convert Your SGLI to a Commercial Policy

You can convert your SGLI coverage to an individual commercial policy within 120 days of separation without undergoing a medical exam to obtain coverage. However, few insurers offer a direct conversion from SGLI to individual policies, and costs vary.

This option is also available to military spouses who were covered under FSGLI, unlike VGLI and SGLI disability extensions.

Purchase Coverage from Another Insurer

You are not required to continue your life insurance coverage through one of the above options or maintain coverage at all. If you are beginning a second career, your new employer may offer you life insurance coverage while you work with them. Or, you can shop around for another policy.

Navy Mutual offers a permanent life insurance alternative to recently separated service members and their families who were covered by SGLI or FSGLI while in service. You don’t have to undergo a medical exam or underwriter review if you apply within 120 days of separation.

Navy Mutual representatives can help you determine which of its products will provide your family with the best protection. Schedule a consultation or get a quote online to discuss Navy Mutual’s available term and permanent life insurance policy options.

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Navy Mutual

Navy Mutual is a nonprofit, federally tax-exempt Veterans Service Organization. Established as the Navy Mutual Aid Association in 1879, it is the oldest Congressionally recognized Veterans Service...

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