Those covered by the Veterans' Group Life Insurance, or VGLI, program will see their premiums decrease in April 2021.
The Department of Veterans Affairs announced that monthly premiums for the popular life insurance program will drop by an average of 7%, effective next month.
This means that most veterans under the age of 50 will see a $0.10 monthly decrease for each $10,000 of insurance they purchase. Currently, a 35-year-old pays $1.30 per $10,000 of life insurance; that will drop to $1.20 monthly effective April 1.
That same 35-year-old will see their premiums decrease proportionally for larger amounts of coverage, as well. For the maximum coverage amount of $400,000, the monthly premium will decrease from $52 to $48.
The lower monthly premiums will be effective for all age groups and coverage amounts. Monthly premiums differ by age groups, with older veterans paying a higher amount for coverage. Check out the VA's website for details and premium amounts.
Veterans enrolled in the program do not need to take any action; the decrease will automatically be applied.
In a news release announcing the change, Thomas Murphy, the VA's acting under secretary for benefits, said, "The reduction in VGLI premiums will make life insurance even more affordable for veterans. Offering our veterans better rates for their life insurance as they transition to civilian life is just one effort the department is taking to address the needs of our customers."
VGLI is a life insurance program overseen by the VA, but administered by the Office of Servicemembers' Group Life Insurance, or SGLI, the same life insurance offered to active-duty personnel.
Like SGLI, VGLI coverage is offered in $10,000 increments with a maximum policy amount of $400,000. Members are eligible for VGLI only if they had SGLI coverage while in the military. The policy amount cannot exceed the coverage a member had while on active duty. Veterans can increase their coverage amount by $25,000 every five years if they wish.
Premiums can be paid monthly, quarterly or annually. There is a 5% discount for those making annual payments. Veterans who prepaid their premiums this year will be issued a refund check for the prorated difference in premiums.
Veterans are only eligible to apply for VGLI within one year and 120 days from their discharge date. If they apply within 240 days, no physical examination is necessary; after that time period, proof of good health is necessary to purchase a policy.
Note: Due to COVID-19, these time limits have temporarily been extended by 90 days. Through June 11, 2021, veterans have 330 days after discharge to apply without a physical exam, and one year and 210 days to apply with a physical exam.
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