Financial Life Insurance Planning

Military life is filled with adventure, some of which is planned, and some of which happens from unforeseen events. Waiting for a crisis is not the best thing to do, its better to have a plan, which includes sufficient insurance for those events, you can prepare for but never plan for. It is a good idea to understand what is available to you as a military serviceperson.

All military Servicemembers are eligible for group life insurance through the Serviceman’s Group Life Insurance program, or SGLI. As an active duty member you can get at reduced rates up to four hundred thousand dollars of insurance coverage. The most important issue if you were to suddenly perish would be the financial arrangements for your dependents, family and loved ones that are left behind. Similar insurance coverage is available for Reserves or National Guard Servicemembers. The rates of SGLI tend to be better and more inexpensive than you can obtain from the private sector insurance. SGLI insurance is the place to start, if not enough for your needs you can supplement your coverage with private sector after you max out your SGLI Options.

SGLI coverage also allows up to one hundred thousand dollars coverage for your spouse and ten thousand dollars in available coverage for each child in your household. Do not assume that your coverage is enough, sit down and think about your monthly expenses, and what would happen if you were suddenly out of the picture and your loved ones have to continue on without your income. SGLI coverage premiums do not increase with age of the covered Servicemember or dependents. But SGLI Coverage stops four months (120 days) after discharge.

You have several options after that point if you have SGLI coverage. You can: Convert to Veterans Group Life: The government also administers Veterans group life insurance but it has significant differences from SGLI. The premiums you would pay under a VGLI policy are significantly higher than what you paid under SGLI, and the premiums increase, as you get older.

Obtain Private Insurance: If you are in pretty good health, private insurance may be a better fit for you and your family. VGLI insurance is a good deal sometimes, but it has premiums that when you get older cost you in the long run at times. Whether or not you choose the VGLI option or private insurance, it is important to know the options available.

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