Veteran Life Insurance: SGLI, VGLI, and Your Options After Service

Military Life Insurance Is One of the Most Underused Financial Benefits

The life insurance benefits available to service members and veterans offer exceptional value — but transitioning from Servicemembers Group Life Insurance (SGLI) to long-term coverage requires deliberate action within tight timeframes. Veterans who miss the conversion windows often find themselves without the coverage they intended to keep, or paying significantly more than necessary for civilian alternatives. This guide covers every option from active duty through veteran status so you can make informed decisions at each transition point.

Servicemembers Group Life Insurance (SGLI)

SGLI is the primary life insurance program for active duty service members, active Guard and Reserve members, and certain other uniformed service categories. Key features:

• Coverage amount: Up to $500,000 in $50,000 increments. Most service members carry maximum coverage.
• Premium: $0.06 per $1,000 of coverage per month. At maximum $500,000 coverage, that is $30 per month — one of the lowest life insurance rates available anywhere.
• No underwriting: SGLI coverage is automatic — no medical exam or health questions required. This is exceptionally valuable for service members with health conditions that would make civilian life insurance expensive or unavailable.
• Coverage ends: 120 days after separation from service. After 120 days, SGLI coverage lapses.

Family Servicemembers Group Life Insurance (FSGLI)

FSGLI provides life insurance coverage for spouses and dependent children of service members with SGLI coverage:

• Spouse coverage: Up to $100,000, not to exceed the service member’s SGLI amount
• Dependent children: $10,000 per child at no additional cost
• Premiums: Based on spouse age — $0 to $5.00 per month for $100,000 coverage for spouses under 35; up to $50/month for older age brackets
• FSGLI also ends at separation: Like SGLI, FSGLI coverage ends when the service member separates. Spouses can convert to individual commercial coverage within 120 days of separation without medical underwriting.

Veterans Group Life Insurance (VGLI): The Most Important Post-Separation Decision

VGLI allows separating service members to convert their SGLI coverage to renewable term life insurance without a medical exam — but only within specific timeframes.

The Critical Enrollment Windows

• Within 240 days of separation: Any veteran can apply for VGLI for any amount up to their SGLI coverage amount — no medical underwriting required. This is the most important window to understand.
• Day 241 to 1 year and 120 days after separation: You can still apply for VGLI but must provide evidence of good health. Medical underwriting applies and you may be denied based on health conditions.
• After 1 year and 120 days: You can no longer apply for VGLI at all.

The no-underwriting window within 240 days of separation is exceptionally valuable for veterans with service-connected health conditions. If you have a disability rating, chronic health conditions, or anything that would make civilian life insurance expensive or unavailable, applying for maximum VGLI coverage within 240 days of separation secures lifetime renewable coverage regardless of your health status.

VGLI Cost and Coverage

• Coverage: $10,000 to $500,000 in $10,000 increments, up to your SGLI coverage amount at separation
• Premiums: Based on age and coverage amount. Premiums increase every 5 years. At age 30 with $400,000 coverage: approximately $48/month. At age 50 with $400,000 coverage: approximately $276/month. At age 70: approximately $1,204/month.
• Renewable term: Coverage renews every 5 years without medical underwriting — your health changes cannot cause cancellation.

The significant premium increases with age mean VGLI becomes less cost-competitive compared to civilian term life insurance for healthy veterans as they age. The value of VGLI is highest for veterans with health conditions that limit their civilian coverage options.

Service-Disabled Veterans Insurance (S-DVI)

S-DVI is a VA-administered life insurance program specifically for veterans who received a service-connected disability rating after separation. Features:

• Coverage up to $10,000 of basic S-DVI coverage at low group rates
• Veterans rated totally disabled (100% or TDIU) may qualify for free coverage (premium waiver) and supplemental S-DVI coverage up to $30,000
• Must apply within 2 years of being notified of your service-connected rating
• No medical examination required for the basic policy

S-DVI coverage amounts are modest — $10,000 is not a meaningful life insurance benefit for most families. However, the premium waiver for totally disabled veterans provides free coverage, and the supplemental coverage brings total to $40,000 for qualifying veterans.

Veterans Affairs Life Insurance (VALife) — Newer Option

VALife launched in January 2023 and is now available to all veterans under age 81 with a service-connected disability rating of any percentage — including 0%. Key features:

• Whole life insurance providing permanent coverage with a cash value component
• Coverage up to $40,000
• No medical underwriting — any veteran with any service-connected rating qualifies
• Premiums based on age and coverage amount at time of application
• Two-year waiting period — if death occurs in the first two years from causes other than service-connected disability, only premiums paid are returned

VALife is particularly valuable for older veterans with health conditions who no longer qualify for competitive civilian life insurance at reasonable rates.

Comparing Your Options: Decision Framework

• Healthy veteran under 45 separating from service: Compare VGLI to a 20 or 30-year civilian term policy. Civilian term insurance for a healthy non-smoker in their 30s typically costs $20 to $35/month for $500,000 coverage — competitive with or below VGLI rates for younger veterans. Get multiple civilian quotes before defaulting to VGLI.
• Veteran with service-connected disabilities or health conditions: Apply for maximum VGLI within 240 days of separation regardless of cost comparison — the no-underwriting guarantee is worth the higher premiums if civilian alternatives are expensive or unavailable due to health.
• Veteran over 60 with any service-connected rating: Evaluate VALife as a permanent whole life option for final expense coverage — the no-underwriting guarantee becomes more valuable as civilian options become limited or very expensive.

Bottom Line

The 240-day window after separation is the most important life insurance decision point for most veterans. Apply for VGLI within that window to secure coverage without underwriting, then evaluate whether to maintain VGLI or convert to civilian term insurance based on your health status and the premium comparison at your age. Veterans with service-connected conditions should strongly favor the no-underwriting path — the ability to maintain coverage regardless of health changes is a benefit that civilian insurers cannot match.