What is Servicemembers’ Group Life Insurance (SGLI)

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Servicemembers Group Life Insurance Overview
Pros and cons of Servicemembers Group Life Insurance, including no physical exam life insurance, low cost, and coverage from acts of war.
Table of Contents
  1. What Makes SGLI Unique?
  2. How Much Coverage Can I Get with SGLI?
  3. How Much Does SGLI cost?
  4. Benefits of Servicemembers’ Group Life Insurance
  5. What Happens to SGLI When I Leave the Service?
    1. Individual Life Insurance Policy from a Private Company
    2. Group Life Insurance through Employer or Similar Organization
    3. Veterans Group Life Insurance (VGLI)
  6. Free Financial Counseling Service for SGLI Beneficiaries
  7. SGLI FAQs and other Questions

The Servicemembers’ Group Life Insurance (SGLI) is a low-cost group life insurance program for active duty servicemembers. This includes reservists, members of the National Guard, members of the Commissioned Corps of the National Oceanic and Atmospheric Administration, and Public Health Service. In addition, cadets and midshipmen of the four service academies, and members of the Reserve Officer Training Corps are eligible for SGLI coverage.

What Makes SGLI Unique?

SGLI has several features that make it a great option for service members. To begin with, SGLI is a group life insurance plan. In this case, it means that everyone in the eligible group (members of the uniformed services), has access to this plan at the same monthly premium, regardless of their age, gender, or health condition. And everyone pays the same amount for coverage, regardless of age, gender, and other factors. [Spoiler alert! SGLI is very affordable!]

Most life insurance policies take many factors into account when you apply for a policy, including your age, gender, current health, whether or not you smoke, and many other factors. Group life insurance plans, however, offer the same rates for everyone within their respective group.

SGLI participants are also automatically enrolled in the Traumatic Servicemembers Group Life Insurance plan (TSGLI), which provides members with a lump sum cash payment if they have a traumatic injury while covered. This doesn’t have to be a traumatic injury directly related to a war zone, combat, or even military duties. You just need to be on military duty when the injury occurs.

Finally, SGLI policyholders are covered in all combat zones, for deaths that occur due to terrorism, or from hazardous activities. Many commercial life insurance policies have disclaimers and addendums that may prevent the policy from paying out under certain conditions.

How Much Coverage Can I Get with SGLI?

SGLI coverages are available in $50,000 increments up to a maximum amount of $400,000. The $400,000 maximum life insurance policy might not be enough for your needs, so be sure to determine how much life insurance you need and shop around for a civilian health insurance policy if you need more coverage.

We prepared a previous article discussing how much life insurance military members need, taking into consideration various factors specific to military members and their families.

Life insurance coverage for your family. Family Servicemembers’ Group Life Insurance (FSGLI) is an extension of the SGLI program and offers coverage for spouses and children of up to a maximum of $100,000 of insurance coverage for spouses, not to exceed the amount of SGLI the insured member has in force, and $10,000 for dependent children. Spousal coverage is issued in $10,000 increments.

How Much Does SGLI cost?

Servicemembers’ Group Life Insurance premiums are a flat rate and are not based on age, gender, physical conditioning, health, or other factors. Premiums are low, coming in at $0.06 per $1,000 of life insurance coverage. These rates make SGLI a cost-effective program for servicemembers and their families.

The most recent SGLI Rate Change occurred in July, 2019, when premiums were actually decreased from the previous rates of $0.07  per $1,000 of coverage.

As mentioned above, SGLI coverage can be purchased in $50,000 increments, up to $400,000. The following table shows how much SGLI will cost at the various coverage levels.

SGLI Coverage AmountMonthly premium rateTSGLI PremiumTotal Monthly Premium Deduction
$400,000$24.00$1.00$25.00
$350,000$21.00$1.00$22.00
$300,000$18.00$1.00$19.00
$250,000$15.00$1.00$16.00
$200,000$12.00$1.00$13.00
$150,000$9.00$1.00$10.00
$100,000$6.00$1.00$7.00
$50,000$3.00$1.00$4.00

Benefits of Servicemembers’ Group Life Insurance

Military members who are eligible for Servicemembers’ Group Life Insurance should strongly consider SGLI because it has several major advantages over many civilian life insurance policies.

  • The first thing to consider is that SGLI will pay benefits for deaths that occur from an act of war – many civilian policies do not have this coverage.
  • SGLI also has an available traumatic injury rider which will pay out in the event of some injuries.
  • Finally, insurance rates are a flat cost regardless of age, gender, health, whether you are a smoker or non-smoker, and other factors. Most civilian life insurance policies are based on age, health, and related factors.

What Happens to SGLI When I Leave the Service?

SGLI is only available to those who are currently serving in the uniformed services listed above. That means your policy will end after you leave the military (actually, the VA provides members with 120 days of additional coverage after they leave the military). But after that 120-day grace period, your SGLI policy ends.

It is up to servicemembers to obtain a new life insurance policy either before or after leaving the military. There are many ways you can obtain a life insurance policy to protect your family.

Here are the three major ways:

  • Individual life insurance policy through a commercial life insurance company
  • Group life insurance policy through a new employer or membership group
  • Veterans Group Life Insurance

Let’s take a quick look at each of these:

Individual Life Insurance Policy from a Private Company

This is the type of life insurance policy you buy on your own. You have to actively seek out quotes from life insurance companies and make a purchase based on the best option for you and your family. While there are many different types of life insurance policies, the two most common are Term Life Insurance and Whole Life Insurance. In general, Term Life Insurance is a better option for most individuals.

This article can help you with some things to think about regarding your life insurance needs when you leave the military.

Here are a few trusted life insurance organizations that are worth looking into:

  • USAA Life Insurance – USAA is a trusted leader in the military financial arena.
  • Navy Mutual Life Insurance – Navy Mutual is another leading provider of life insurance policies for the military community.
  • Policy Genius – Policy Genius helps users shop around for excellent life insurance rates and can give you a quote and approval answer in a very short amount of time.

Group Life Insurance through Employer or Similar Organization

You may also be able to obtain a group life insurance policy through an employer or a membership organization, such as a trade organization, a military veteran organization, or something similar.

In general, group life insurance is easier to obtain than a term life insurance policy. However, the life insurance premiums may or may not be more affordable than buying your own policy. Additionally, you will need to consider tthree big factors:

  • How affordable is the policy,
  • How long you will be able to keep the policy, and
  • Does the policy offer enough coverage

How much does the life insurance policy cost compared to buying a term life insurance plan on your own? If you buy life insurance through your employer, can you take it with you when you change employers?

Can you get enough coverage? Some group life insurance policies limit their coverage to a fixed amount, such as $50,000 or $100,000, or they may tie it to your salary, such as two to three times your base salary.

All of these are important factors in deciding which life insurance policy to choose from.

Veterans Group Life Insurance (VGLI)

Please note that due to COVID-19 enrollment criteria have changed. Due to the economic downturn, you now have an extra 90 days. Instead of having 120 days past discharge, you have 330. Additionally, the time period to apply for VGLI with proof of good health is extended to 1 year and 210 days following separation from the military.  This extension is good through June 11, 2021.

One of the more popular group life insurance programs for veterans is the Veterans’ Group Life Insurance (VGLI) program run by the VA. VGLI is also a group life insurance program, and the rates are based only on age, and not on gender, health, smoker or non-smoker, or other factors.

SGLI policyholders can convert their SGLI policy to a VGLI policy after they leave the uniformed services. However, members only have one year and 120 days to convert their SGLI policy to a VGLI policy. In addition, you can only buy VGLI coverage up to the amount of SGLI coverage you had prior to leaving the military.

Finally, the timing is important when converting your SGLI policy to a VGLI policy. If you convert the policy within 240 days of leaving the military, you will not have to take a health exam prior to obtaining a VGLI policy. However, you will have to fill out a health questionnaire prior to obtaining a VGLI policy if you wait longer than 240 days to apply.

This can have an impact on your ability to obtain insurance coverage if you have medical conditions that may prevent you from obtaining a life insurance policy.

Free Financial Counseling Service for SGLI Beneficiaries

The Servicemembers’ Group Life Insurance sponsors free financial counseling for recipients of SGLI benefits. The servicemembers’ life insurance policy website also provides information regarding family coverages and disability insurance for those servicemembers who are now disabled. Servicemembers can also receive personalized service regarding a tailored financial plan for their personal or family situation.

In addition, servicemembers’ specific personal issues can be taken into account and discussed using their personalized service. For example, what steps to take to meet your specific insurance coverage needs or those that may best benefit a servicemember and his family. Since the personalized service has no affiliations with any banks or investment firms, no products to sell, and aren’t working on commission, you be assured that they’ll give you objective, sound advice for your unique financial situation.

SGLI FAQs and other Questions

If a servicemember or her family has further questions regarding the SGLI is, she can visit the VA website and follow links to frequently asked questions and further information.

If a question isn’t answered in the FAQs, servicemembers can read the comprehensive overview of the SGLI program in the SGLI/VGLI handbook, which provides more information. Both are designed to be informative, and offer FAQs proficiently.

If for some reason you’re unable to locate the information you’re seeking for your specific situation, you can also contact the Personnel office of the SGLI at 1-800-419-1473 and they should be able to give you further assistance and answer any questions you may have.

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About Ryan Guina

Ryan Guina is the founder and editor of The Military Wallet. He is a writer, small business owner, and entrepreneur. He served over 6 years on active duty in the USAF and is a current member of the IL Air National Guard.

Ryan started The Military Wallet in 2007 after separating from active duty military service and has been writing about financial, small business, and military benefits topics since then. He also writes about personal finance and investing at Cash Money Life.

Ryan uses Personal Capital to track and manage his finances. Personal Capital is a free software program that allows him to track his net worth, balance his investment portfolio, track his income and expenses, and much more. You can open a free Personal Capital account here.

Featured In: Ryan's writing has been featured in the following publications: Forbes, Military.com, US News & World Report, Yahoo Finance, Reserve & National Guard Magazine (print and online editions), Military Influencer Magazine, Cash Money Life, The Military Guide, USAA, Go Banking Rates, and many other publications.

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  1. Peter C. Lomtevas says

    Military insurance is by no means a “benefit”. Especially for the aging veteran, premiums jump every five years and by unpredictable increments. The payouts are slow and low. It is not possible to get more than $200,000 for roughly $830 annually which is a really raw deal. This is characteristic of military service: they give you $100 and take back $99.

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