Life Insurance Form

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TXDad01

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I couldn’t find any threads on this topic… has anyone else noticed the default policy for the life insurance?

The default policy is for $500,000 at $34/month. That seems like a large policy for an 18 or 19 year old.

You can change the amount but you have to check specific boxes in order to do so.
 
I put the lowest (50k) option just in case. I heard that you can change the amount each year so I'll just increase the coverage if needed in the future. Though, I don't think I'll die at USMA so I should be fine with 50k for right now.
 
This comes up every year.

The Servicemember’s Group Life Insurance (SGLI) is the military member standard term life policy.

The key thing about it - no combat exclusion or hazardous duty exceptions. It pays out no matter what the service member is doing or where they are doing it. Civilian life insurance policies usually do not cover military pilots, special operations, EOD, in combat zones or other military situations. SGLI also pays out in the case of suicide and misconduct. Sadly, these are facts of life in a demanding life. The goal is the service member leaves a healthy sum to those he or she leaves behind, who will no longer benefit from his monthly pay and potentially retirement pay. It is very inexpensive for what it covers.

Recommend taking a smaller amount and then upping it stepwise later, and he can consider doing the max when spouse, kids, mortgage and college educations are in the mix.

I will never forget one of our USNA sponsor sons, the oldest kid in his family, who had a mom working 2 minimum wage jobs and a disabled dad, say to me he planned to help his family out of every paycheck he earned, and if something happened to him during summer training at USNA or any other accident, he wanted to leave something for his siblings. He took $75K as a mid and a week after graduation, upped his election to the max. He was going ground Marine and knew combat duty was in his near-term future. Happily, he got through 2 combat tours and is a successful financial services executive now.
 
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Ours took out the largest policy at time (420k and 26 monthly). the sole beneficiary was her sister and only sibling.

It's a good policy and a great value considering that is is the profession of arms. Some serious training takes place.
 
Capt MJ said:
This comes up every year.

The Servicemember’s Group Life Insurance (SGLI) is the military member standard term life policy.

The key thing about it - no combat exclusion or hazardous duty exceptions. It pays out no matter what the service member is doing or where they are doing it. Civilian life insurance policies usually do not cover military pilots, special operations, EOD, in combat zones or other military situations. SGLI also pays out in the case of suicide and misconduct. Sadly, these are facts of life in a demanding life. The goal is the service member leaves a healthy sum to those he or she leaves behind, who will no longer benefit from his monthly pay and potentially retirement pay. It is very inexpensive for what it covers.

Recommend taking a smaller amount and then upping it stepwise later, and he can consider doing the max when spouse, kids, mortgage and college educations are in the mix.

I will never forget one of our USNA sponsor sons, the oldest kid in his family, who had a mom working 2 minimum wage jobs and a disabled dad, say to me he planned to help his family out of every paycheck he earned, and if something happened to him during summer training at USNA or any other accident, he wanted to leave something for his siblings. He took $75K as a mid and a week after graduation, upped his election to the max. He was going ground Marine and knew combat duty was in his near-term future. Happily, he got through 2 combat tours and is a successful financial services executive now.
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I understand as they get close to leaving the academy and about to embark on active duty, it makes sense to increase the amount. Just seemed a little odd to make the default for a plebe as $500,000. 🤷‍♂️

Guessing most people overlook that part because you have to reference another packet to see the rate card.

Regardless, it was a great learning opportunity for our DS to read the details before signing forms.
 
I think many people don’t realize that insurance policy they bought for their young child may not cover many if the things they will be doing or where they will be doing it during their military service.
 
TXDad01 said:
I understand as they get close to leaving the academy and about to embark on active duty, it makes sense to increase the amount. Just seemed a little odd to make the default for a plebe as $500,000. 🤷‍♂️

Guessing most people overlook that part because you have to reference another packet to see the rate card.

Regardless, it was a great learning opportunity for our DS to read the details before signing forms.
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I think it’s the same for an E-1 headed to boot camp. Default setting. Good life lesson!
 
My cadet candidate said he selected the larger amount because he would need it one day and he wanted to get used to that coming out of pay from the start.
 
were you able to generate the pdf and print it? DS hasn't done this yet but the emergency form does not generate filled out. comes up blank....
 
The reason for the default amount set to maximum is that many will not remember to increase it later or will be penny wise and naively select too low an amount.

The insurance is cheap, has no combat exclusions, and it is better to have too much insurance than too little. I was once the Survivor Assistance Officer for the widow and new born child of a soldier who had a $50k policy. She thought it was a huge amount, but didn't understand how long it needed to last.
 
TXDad01 said:
I couldn’t find any threads on this topic… has anyone else noticed the default policy for the life insurance?

The default policy is for $500,000 at $34/month. That seems like a large policy for an 18 or 19 year old.

You can change the amount but you have to check specific boxes in order to do so.
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Take the full amount and leave it to one of your parents or split it among your siblings. People do die at USMA and during military training--and it devastates families. So, do not cut your family short because you do not understand.
 
DrMom said:
Take the full amount and leave it to one of your parents or split it among your siblings. People do die at USMA and during military training--and it devastates families. So, do not cut your family short because you do not understand.
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also, when you commission, you will have to go in and reset the amount to the full amount--take the SLGI at its full rate. It matters.
 
DrMom said:
Take the full amount and leave it to one of your parents or split it among your siblings. People do die at USMA and during military training--and it devastates families. So, do not cut your family short because you do not understand.
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I agree with this recommendation. And on a side note, siblings need to be over 18 to be designated as beneficiaries.
 
OldRetSWO said:
It is the default for everyone entering the US Military.
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So where it ask us to list our current amount of SGLI, should we put 500,000? I was not sure for that part, considering that this was the first time I ever had to fill out that form. I read somewhere on the same document that if you are entering for the first time that the default amount is 500,000, so I guess that is what should be placed. Just wanted to be sure :)
 
My DS is starting AROTC this fall and just had to return a bunch of paperwork to the ROO. Among that was the $500,000 SGLI form, designating beneficiaries. So, I sort of assumed the Army is providing that benefit to him as a scholarship cadet. There was no mention of any cost. Just fill out the form and return it.
 
SpaceHopper said:
So where it ask us to list our current amount of SGLI, should we put 500,000? I was not sure for that part, considering that this was the first time I ever had to fill out that form. I read somewhere on the same document that if you are entering for the first time that the default amount is 500,000, so I guess that is what should be placed. Just wanted to be sure :)
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Are you currently enlisted? That is the only way you would already have SGLI.

If the default coverage is $500,000, meaning that’s what it will be if you don’t choose anything else, including zero.

If you read the posts in this thread from the start, you’ll see that you can elect a lesser amount - which puts more money in your monthly pay as your insurance deduction would be less. Please take a few minutes to read the earlier posts and perhaps search for others. This comes up every year.

Term life insurance works like this. You die. Your named beneficiary/beneficiaries gets the insurance payout. The reason people take larger amounts is if they have big loans like a house loan (mortgage) to pay off, or a spouse to provide some financial cushion to because your salary is now stopped, other debts to be paid off, children’s education accounts to be contributed to, etc.

Your SGLI amount can be adjusted at any time (well, except during this coming summer, you’ll be occupied).

Think about what seems right for you and choose that amount. Closer to graduation in 4 years, you may choose to go a bit higher. When you acquire a house, spouse, kids and stuff, you adjust again. And it is perfectly fine to choose the max amount. It is inexpensive for the amount you get and the type of coverage - it covers causes of death usually not covered by civilian policies.

It’s a risk analysis thinking problem weighing more coverage and its higher monthly cost versus a lower amount of coverage and less taken out of monthly pay.

I hope that helps. You will gain personal financial management knowledge along the way. Pay attention to it - your older self will thank you.

Cadet Budget Book - 2023-2024 - updated every year. See link. You’ll see in the Cadet Pay section SGLI is a regular deduction. This is a publication worth reviewing with your parents. It will eventually make sense to you as a cadet.


 
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pa-outdoorsman said:
My DS is starting AROTC this fall and just had to return a bunch of paperwork to the ROO. Among that was the $500,000 SGLI form, designating beneficiaries. So, I sort of assumed the Army is providing that benefit to him as a scholarship cadet. There was no mention of any cost. Just fill out the form and return it.
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This is a great question to explore, as all AD members pay the premium. I know the least about ROTC pay and their various statuses as they cycle between student status and active training status.

You may find Appendix F interesting reading, as to when SGLI covers ROTC cadets.


Ignore the VGLI stuff. That’s an option for those separating or retiring, especially if they are essentially uninsurable or only expensively so due to their nature of their health conditions or injuries.
 
Capt MJ said:
This is a great question to explore, as all AD members pay the premium. I know the least about ROTC pay and their various statuses as they cycle between student status and active training status.

You may find Appendix F interesting reading, as to when SGLI covers ROTC cadets.


Ignore the VGLI stuff. That’s an option for those separating or retiring, especially if they are essentially uninsurable or only expensively so due to their nature of their health conditions or injuries.
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Interesting. So, as best as I can tell from looking at the appendix, coverage is provided to ROTC Cadets ONLY during "active" training. To me, this would include Advanced Camp, summers schools for Mountain Warfare, Airborne, semi-annual FTX weekends, etc. It does not read to me as though any coverage in effect during normal school periods or on-campus ROTC activities. However, even the wording in the appendix is confusing, because it refers to "active duty" training and ROTC Cadets in the same sentence, and technically, ROTC cadets are not active duty officers even during trainings because they haven't commissioned yet. They are "contracted cadets" under obligation to the Army.

Anyway, I will just wait and ask the ROO about this benefit next time I see him. Since coverage would be in effect only during very limited times for ROTC Cadets, perhaps this is a benefit the Army provides at no cost during those limited windows. Or, perhaps it is charged, but comes out of a cadet's monthly ROTC stipend only during those months when coverage is in effect. So, maybe they just need the completed SGLI form on file to provide the insurance during applicable periods.
 
pa-outdoorsman said:
Interesting. So, as best as I can tell from looking at the appendix, coverage is provided to ROTC Cadets ONLY during "active" training. To me, this would include Advanced Camp, summers schools for Mountain Warfare, Airborne, semi-annual FTX weekends, etc. It does not read to me as though any coverage in effect during normal school periods or on-campus ROTC activities. However, even the wording in the appendix is confusing, because it refers to "active duty" training and ROTC Cadets in the same sentence, and technically, ROTC cadets are not active duty officers even during trainings because they haven't commissioned yet. They are "contracted cadets" under obligation to the Army.

Anyway, I will just wait and ask the ROO about this benefit next time I see him. Since coverage would be in effect only during very limited times for ROTC Cadets, perhaps this is a benefit the Army provides at no cost during those limited windows. Or, perhaps it is charged, but comes out of a cadet's monthly ROTC stipend only during those months when coverage is in effect. So, maybe they just need the completed SGLI form on file to provide the insurance during applicable periods.
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I’d be interested to hear what you find out. ROTC is my weakest area of knowledge, and I am always learning. I had always vaguely thought they got the SGLI admin done just prior to commissioning or going full AD status.
 
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