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Servicemembers' Group Life Insurance (SGLI) is a
life insurance Life insurance (or life assurance, especially in the Commonwealth of Nations) is a contract between an insurance policy holder and an insurer or assurer, where the insurer promises to pay a designated beneficiary a sum of money upon the dea ...
program available to all active duty and
reserve Reserve or reserves may refer to: Places * Reserve, Kansas, a US city * Reserve, Louisiana, a census-designated place in St. John the Baptist Parish * Reserve, Montana, a census-designated place in Sheridan County * Reserve, New Mexico, a US ...
members of the
uniformed services of the United States The United States has eight federal uniformed services that commission officers as defined by Title 10 and subsequently structured and organized by Titles 10, 14, 32, 33 and 42 of the U.S. Code. Uniformed services The uniformed services ...
. Supervised by the
United States Department of Veterans Affairs The United States Department of Veterans Affairs (VA) is a Cabinet-level executive branch department of the federal government charged with providing life-long healthcare services to eligible military veterans at the 170 VA medical centers a ...
, the program is administered by the Prudential Insurance Company of America. It is available to active-duty members of the
Army An army (from Old French ''armee'', itself derived from the Latin verb ''armāre'', meaning "to arm", and related to the Latin noun ''arma'', meaning "arms" or "weapons"), ground force or land force is a fighting force that fights primarily on ...
, Marine Corps,
Navy A navy, naval force, or maritime force is the branch of a nation's armed forces principally designated for naval and amphibious warfare; namely, lake-borne, riverine, littoral, or ocean-borne combat operations and related functions. It in ...
,
Air Force An air force – in the broadest sense – is the national military branch that primarily conducts aerial warfare. More specifically, it is the branch of a nation's armed services that is responsible for aerial warfare as distinct from an ...
,
Space Force A space force is a military branch of a nation's armed forces that conducts military operations in outer space and space warfare. The world's first space force was the Russian Space Forces, established in 1992 as an independent military service. ...
,
Coast Guard A coast guard or coastguard is a maritime security organization of a particular country. The term embraces wide range of responsibilities in different countries, from being a heavily armed military force with customs and security duties to ...
, United States Public Health Service Commissioned Corps, and the National Oceanic and Atmospheric Administration Commissioned Corps. Ready reservists,
cadet A cadet is an officer trainee or candidate. The term is frequently used to refer to those training to become an officer in the military, often a person who is a junior trainee. Its meaning may vary between countries which can include youths in ...
s, and
midshipmen A midshipman is an officer of the lowest rank, in the Royal Navy, United States Navy, and many Commonwealth navies. Commonwealth countries which use the rank include Canada (Naval Cadet), Australia, Bangladesh, Namibia, New Zealand, Sout ...
at the four service academies (but not the Merchant Marine Academy), and members of the
Reserve Officer Training Corps The Reserve Officers' Training Corps (ROTC ( or )) is a group of college- and university-based officer-training programs for training commissioned officers of the United States Armed Forces. Overview While ROTC graduate officers serve in all ...
are also all eligible. Insurance is available in increments of $50,000, up to a maximum of $400,000. As of July 1, 2019, SGLI premiums are $0.06 per month per $1,000 of insurance, regardless of the member's age. An additional $1 per month is charged for traumatic injury protection (TSGLI). Accordingly, a $400,000 policy costs $25 per month. Notably, the SGLI does not have a ''war clause'' exclusion which otherwise precludes benefits if death results from combat. Effective March 1, 2023, the maximum SGLI coverage will increase to $500,000. Veterans' Group Life Insurance (VGLI) is a similar product available to
veteran A veteran () is a person who has significant experience (and is usually adept and esteemed) and expertise in a particular occupation or field. A military veteran is a person who is no longer serving in a military. A military veteran that h ...
s. SGLI policyholders may convert their policy to VGLI upon
discharge Discharge may refer to Expel or let go * Discharge, the act of firing a gun * Discharge, or termination of employment, the end of an employee's duration with an employer * Military discharge, the release of a member of the armed forces from ser ...
unless an exception for total disability applies. Premiums for VGLI are higher and are based on the age of the insured.


US military life insurance lawsuit

In 2010, various media outlets noted allegations that the Prudential Life Insurance Company was manipulating the payout of life insurance benefits due to the families of American service members to gain extra profits. The company provided life insurance to people in the armed forces under a government contract. Rather than paying the full amount due to the families at once, the company would instead deposit the funds into a Prudential corporate account. These accounts are referred to as 'retained asset accounts' and are essentially an I.O.U. from the company to the payee (in many cases a fallen service members' family). While in early 2010 Prudential was making profits of up to 4.2% in its general account, they paid out 0.5% interest in these non-FDIC insured "Alliance" accounts. In some cases, when families requested to be sent a full payout in the form of a check, the family was sent a checkbook, rather than the amount due. It is not clear if the practice violated the law or the contract. In August 2010, the company was sued by some bereaved families. The company's response included an open letter to the military community in which it addressed what it characterized as "misinformation" about the nature of the accounts. ''
Military Times Sightline Media Group, formerly Gannett Government Media and Army Times Publishing Company, is a United States company that publishes newspapers, magazines, websites, and other publications about the U.S. and other militaries. The company's '' ...
'' noted that prior lawsuits against insurance companies pertaining to the use of retained asset accounts have been dismissed in federal courts without action.


Alternatives

Insurance coverage similar to SGLI is replicated by a few other private organizations. These include th
Military Benefit Association
(MBA), the United Services Automobile Association ( USAA), the Army and Air Force Mutual Aid Association (AAFMAA), the Uniformed Services Benefit Association (USBA), the Armed Services Mutual Benefit Association (ASMBA), and the Navy Mutual Aid Association (NMAA). These organizations provide insurance for members of the armed forces, sometimes with similar or higher coverage levels at rates that are similar to or lower than SGLI. Like SGLI, the coverage provided is unique in that it is tailored to the needs of military members, and do not have war clause exclusions.


References

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External links


Official website
United States Department of Veterans Affairs Life insurance companies of the United States Prudential Financial