If you are a member of the US Army in any capacity, we thank you very much for your excellent service to our country. Your dedication is greatly appreciated by all Americans. You are probably interested in applying for military life insurance for you and your family. This article should answer many of your questions. It will definitely help you find quality life insurance products with the lowest rates possible. These rates I am referring to would be on the civilian market that you can qualify for.
Some members of the US Army have life insurance purchased through SGLI (Service Members Group Life Insurance). Most veterans wonder what to do about your military life insurance after you are eventually discharged. This article will help you find the best choices to secure low cost Term life insurance for US Army veterans. This will apply after you are discharged and even while you are still an active in the Army.
This information will be directed to all the major branches of the US Armed Forces. This article will be mainly focused on the US Army. If you are a member of another branch, that is OK, just keep on reading.
There are three basic types of life insurance on the market today that you should understand.
To properly shop for life insurance you should have a basic understanding of the three main types of life insurance. I want to make sure you understand these before we move along.
Term Life Insurance is the most commonly purchased plan design today. Always remember that Term is a temporary product that has a specific time period. They have Term periods such as 10, 15, 20, 25 and 30 years. They have the lowest premium by far and they can be converted into a permanent plan design also.
Universal Life Insurance is a permanent plan design which will normally last your entire life. You do not have to worry about your policy expiring and having no life insurance when you need it. Universal Life cost more than Term but you will always remain insured as long as you keep paying your premiums.
Whole Life Insurance is a permanent plan design that uses a cash value system. It is one of the oldest plan designs on the market. This cash value is generated by an interest rate that builds up through the years. The Whole Life products have been eliminated by many life insurance companies because of their much higher premiums. For all practical purposes, whole life has been replaced by the much more cost effective Universal Life plan design.
If you have SGLI life insurance and you are considering converting to VGLI, you have much better options to consider.
The first idea many Army Personnel have is to convert their SGLI policy to a VGLI policy. This would be the (Veterans Group Life Insurance) policy once they are discharged. This is an option you definitely have so let’s take a look at this option first. Then we will see what is involved to process this transition from one to another.
Option #1 Applying for VGLI Life Insurance:
Within a 45 to 60-day period of time following your discharge from the Army. You should receive an application from OSGLI (Office of Servicemen’s Group Life Insurance). You have a time limit of one year and 120 days from your discharge to apply for a VGLI policy. After this, you will no longer be eligible for VGLI life insurance. If you submit a VGLI application within 120 days following your discharge. You may submit your VGLI application along with the first month’s premium. You will not need any evidence of being in good health what so ever.
If you submit a VGLI application between 120 days and one year and 120 days after your discharge. You will need to provide proof that you are in good health. This is also called evidence of insurability. Keep in mind that your application may actually be declined if you are not in good health.
Veterans Group Life Insurance rates increase with age and can get very expensive as the years go by. This is why the other options you have are so much more cost effective.
You are also going to be limited to a face amount (death benefit) of $400,000. This can also be no more than the face amount of your original SGLI policy.
The veteran’s administration (VGLI) Veterans Group Life Insurance policies have a rate increase every five years.
These plan designs are in essence a five-year renewable Term life policy. These policies include a substantial rate increase every 5 years like clockwork. If you are in decent health your premiums would be drastically less with a conventional life insurance product. You would then have level premiums that do not go up. Take a look at a sample of the VGLI rates with a $400,000 face amount. Especially pay attention to the higher age groups starting with 50-54 years of age.
- Age 29 & Below – $32.00 per month
- Age 30 to 34 – $40.00 per month
- Age 35 to 39 – $52.00 per month
- Age 40 to 44 – $68.00 per month
- Age 45 to 49 – $88.00 per month
- Age 50 to 54 – $144.00 per month
- Age 55 to 59 – $268.00 per month
- Age 60 to 64 – $432.00 per month
- Age 65 to 69 – $600.00 per month
- Age 70 to 74 – $920.00 per month
- Age 75 & Up – $1840.00 per month
The youngest age category of 29 and below have rates that are higher than conventional Term life insurance. The older age categories have incredibly high rates that most Americans could not even afford. Conservatively speaking if you were age 55-59 your premiums would be $3,216.00 per year. The age 60-64 veterans would be paying $5,184.00 per year. The final age group of 75 and over would have an annual premium of $22,080.00 per year. Review their rates on the VGLI website.
If an individual is in very poor health, these policies may work for you. If any veteran in good health is considering purchasing life insurance through the VGLI. The life insurance offered from the conventional life insurance companies in the US will be the only way to go. These 5 year rate increases are brutal to the wallet. They don’t make sense when there are so many other great options to choose from.
Option #2 will be your best choice. Apply for conventional life insurance on the regular civilian life insurance market:
As I just mentioned, your second option after discharge would be to apply for Term life insurance through the conventional civilian market. This would be far less expensive and very simple to accomplish. Remember when you go this route your rates would not be based on your military background. You would be able to receive the lowest rates possible on Term life insurance or permanent life insurance.
Your exposure to the military would not enter the picture. You can purchase low cost Term life insurance on the civilian market. Even if you are in the Reserves, National Guard or even a member of the Full-Time Army.
Members of the National Guard or the Reserves applications would be treated like any other occupation. There would be no increase in life insurance rates or stipulations. If you are full time military, you still can purchase life insurance on the affordable civilian market. There would be some basic questions that need to be answered such as:
- How much time are you going to be spending overseas.
- Are there any plans for deployment in the next 12 months?
- What are your current duties & responsibilities?
How much will Term life insurance cost for a discharged military veteran?
If you apply for Term life insurance or a permanent plan design such as Universal Life. Your rates will be based on the usual underwriting criteria below:
- Your Current Age
- Health History
- Tobacco Status
- Height & Weight
- Occupation (If Hazardous)
- Sports (If Hazardous)
- Driving Record
Keep in mind that the above list applies to fully underwritten policies. These types of policies always have the very lowest rates available. Simplified issue life insurance which is also referred to as Non-Med life insurance can be approved quickly in 24-48 hours. They do cost more because the life insurance companies do not know as much about your health history. They have to add some buffer premium for the added risk they take.
I always recommend the fully underwritten policies so you can receive the lowest premiums possible. This application may take longer but the lower rates will be well worth the wait.
What happens if I have pre-existing medical conditions?
Applying for life insurance with medical conditions such as high blood pressure, high cholesterol, anxiety, height & weight issues and many others are very common these days. A medical pre-screen will help direct you to the correct company to apply with and help you to receive the lowest rates possible. A medical pre-screen takes a few minutes and is totally confidential and simple to perform. Your agent can take care of this for you and get you on track to a smooth application process. We highly recommend pre-screens to take the guesswork out of the application process. Nobody likes surprises when applying for life insurance.
What if I am a member of the Army National Guard or the Reserves?
This is a very good question when you think about it. This due to the fact a Reservist or National Guardsman could be deployed at virtually any given time. The life insurance companies look at this scenario as your application would be treated just like anyone else’s. This would be as long as you do not have deployment orders pending. This makes everything very simple.
How do I go about applying for affordable military life insurance?
For starters, you can compare Term life insurance quotes along with Universal Life also on our free consumer quote engine on the right. You can compare the lowest rates from the most competitive and trusted life insurance companies. Don’t hesitate to contact us 7 days a week by calling (800)897-5699 for answers to all your questions.
Make sure to contact an independent insurance agent so you will be able to compare all the top companies. This will make sure you receive the lowest life insurance rates possible. AIG American General, Prudential & MetLife do a great job.
Independent insurance agents are also known as brokers. They have complete access to all the best life insurance companies on the market. State Farm agents and Farmers agents for example are referred to as captive agents. They only have one life insurance company to show you. In today’s competitive life insurance market, that will not work. Looking at only one company will be a huge handicap when trying to receive the lowest term life insurance rates.
Our office utilizes over 40 trusted companies such as Prudential, Banner Life, Transamerica, Protective Life, Assurity, Voya, MetLife, Aviva, AXA Equitable, ING, SBLI, Fidelity Life and many more. AIG American General has some of the lowest rates for members of the US Army. Check out our Top 12 Life Insurance Companies blog post. You can get some more information about the excellent companies we use.
You proudly served our country and we are proud to have the opportunity to serve you.
If what you just read seems to be confusing, don’t worry about it because it can be very confusing at times. Don’t hesitate to grab the phone and call us 7 days a week. We will be happy to answer all your questions for you. Shopping for the best military life insurance rates should always be a simple process.
Especially when you have an experienced insurance professional helping you. We can help you find the best life insurance for your needs and budget. Visit our About Us page for more information about us and our business.
If you’d like to begin comparing the best rates for military life insurance, feel free to use the quoting form on this page. We can help make more sense of the different plan options available and give you some good peace of mind. Just give us a call and we will be glad to help. Thank you very much for taking the time to read this article.