Life Insurance

Discussion in 'Naval Academy - USNA' started by Tobes, May 7, 2012.

  1. Tobes

    Tobes Member

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    Just got the PTR, does anyone have any advice about life insurance? I really hadn't thought about it that much.
     
  2. EngSSN754

    EngSSN754 New Member

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    SGLI

    I am assuming that you are referring to the Serviceman's Group Life Insurance (SGLI) - the $400,000 insurance coverage. It is a GREAT deal, Sign up for the full premium and coverage. It is cheap. I am pretty sure that you will not be able to find a better deal out there for fixed premium term coverage. And it is easy. There is no underwriting - coverage is automatic if you sign up and allow the premiums to be deducted from the paycheck. Granted, the kids do not have a risky job right now (unless you consider Plebe Year to be hazardous to health and welfare), but later on, their profession will, most likely, rate them up for life insurance coverage. I don't know what the rules are for opting in later if you initially opt out, or increasing coverage up to the max if you initially start out at a lower level (like $100,000 instead of the maximum $400,000). You might look into this if premium dollars are a concern, or if you think that $400K is overkill. However, I believe that any active duty service member, especially one with dependents or a close family member (like parents or siblings) who is not covered at the max is not taking the long view. The same rationale could apply to Midshipmen. Accidents and other not-so-good things do happen (i.e., life happens).
     
  3. Dolphins2012

    Dolphins2012 Parent

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    I advised my plebe-to-be to get just $50k. That's about $4 a month, as opposed to up to something like $28 a month for the $400k coverage. All of the rates are good deals, absolutely. But I don't think my son needs to be paying $336 a year so that his mother and I will benefit from a windfall should tragedy strike. $50k would be more than ample for funeral and any travel expenses, and then some. Talk it over with your folks, of course, but these are one parent's thoughts.
     
  4. AF6872

    AF6872 Member

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    As a parent I would reccomend SGLI. I had it as a service member. The amount is up to each individual service member.
     
  5. tedsnyder63

    tedsnyder63 Member

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    Not to be morbid, but call it what it is essentially, Death Insurance. In my opinion, unless a mid is supporting someone, only carry enough to deal with funeral expenses. I advised my mid to choose the smallest amount. As his family situation changes, the mid can bump it up. I cannot see any need to carry the full amount.
     
  6. 2012mom?

    2012mom? Member

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    The rate will never be cheaper than now, so I agree with others that at least some minimum coverage is a good idea. Before deciding on the amount, I would want to know whether the rate goes up if the service member later wants to increase his/her coverage. If there would be a rate change, I would advise getting max coverage now.
     
  7. kdc246

    kdc246 Member

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    I am going to give perspective from a retired AF personnel specialist. When we had new personnel in-processing we always recommended taking the full amount. It may be slightly different in the Navy. The reason being was that when you initially take the insurance there is nothing keeping you from taking the full amount. However, if you took a lesser amount and then later on decided you wanted more, there was more paperwork involved. It was not as simple as saying you wanted more and and increase in premiums. In the AF you need to get a letter signed by your commander attesting to your current health and fitness.

    Once again I will say this was experience in the Air Force not the Navy. I have recommended both of my cadets carry the full amount. As was stated earlier it will never be cheaper. I have upon occasion actual seen the premiums go down through out my career. Doesn't happen often, but it does happen.
     
  8. kinnem

    kinnem Moderator

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    That's certainly one way to look at it, and is a reasonable approach. Another is, if I can save hundreds a year for several years then its worth the additional trouble encountered when increasing it later. If you don't take the full amount now I expect one would certainly increase it later. It all depends on whether the "pain" is worth it to you (assuming you remain in reasonably good health.
     
  9. usna1985

    usna1985 USNA Alumnus

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    As a mid, you have no dependents and you're unlikely to die, so there's no need for insurance.

    When you graduate, you MAY have dependents if you marry right away -- that depends on whether your spouse is self-supporting. If he/she is, you don't "need" insurance. If you later have kids, you have dependents and should get insurance.

    SGLI is really cheap. I would evaluate what you can elect now and for how much vs. what you can elect later and for how much. It may be worth it to start now so that you have it later; that depends on whether you can elect it later and whether the cost increases significantly.

    In our day, we were told to do it. Given that we were "at peace" and most of us didn't have dependents, it probably wasn't great advice. Now that many will deploy in harm's way, the situation is somewhat different. I suggest you consult a financial planner -- or just spend the money on SGLI and then you know you're covered.
     
  10. William36912

    William36912 Member

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    So what's the risk of signing up later? Can I just cover myself after I get married, or will the rates when I'm active duty make me wish I'd just shelled out as a Mid?
     
  11. kinnem

    kinnem Moderator

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    It depends on the policy, or more specifically, the term. I'm not familiar with this specific policy but here's a very brief overview from Wikipedia on the topic.

    So your rates go up in the future whenever the term ends, although there may be some level of preferential treatment when renewing vs first buying the policy.
     
  12. Just_A_Mom

    Just_A_Mom Member

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    The risk of waiting is that in the meantime you develop a medical condition that makes you uninsurable.
     
  13. AF6872

    AF6872 Member

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