Prevent Delays ♦ Reduce Frustration ♦ Achieve the Best Possible Outcome

2013

VGLI and OtherLife Insurance Options

After TransitionPEB LiaisonMr. Dean Trio

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2

Prevent Delays

Reduce Frustratio

n

Achieve the Best Possible Outcome

Terminal Learning Objectives

As an RCC help Marines and families…

N/A, there are deadlines that must be met

Provide basic factual information about options Help the Marine understand the necessary paperwork

Help Marines find the local office of companies participating in the commercial policy conversion program

Keep the Marine on track so that life insurance can be procured without a proof of health requirement

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3

Enabling Learning Objectives

Identify the options available to Marines who have a valid SGLI policy when they transition

Identify the options available to provide life insurance for a spouse after transition

Identify SGLI, TSGLI, FGLI, VGLI, and S-DVIIdentify the window in which a Marine can obtain

VGLI without proof of healthDescribe the process for converting SGLI to VGLIIdentify the factors used to set premiums for VGLI

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VGLI Benefit Profile

Frequency

The vast majority of transitioning Marines are eligible to convert an SGLI policy to either VGLI or a commercial policy

Most Marines opt for VGLI

Drawbacks

Each insurance option includes premiums

Importance to Marines

Most Marines are eligible for up to $400,000 is life insurance. In the event of their death this is a substantial financial cushion for their survivors.

Challenges

Life insurance decisions are made right at the point of transition when a Marine’s attention is divided.

There are a variety of different programs out there, and educating Marines on the advantages and disadvantages of each is difficult

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5

FGLI Conversion to Commercial Policy

Frequency

The vast majority of married transitioning Marines are eligible to convert an FGLI policy to a commercial policy

Most Marines opt not to

Drawbacks

Each insurance option includes premiums

Importance to Marines

The lifetime premiums and/or the lifetime benefit could exceed $100,000.

Challenges

Life insurance decisions are made right at the point of transition when a Marine’s attention is divided.

There are a variety of different programs out there, and educating Marines on the advantages and disadvantages of each is difficult

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Life Insurance for Active Duty Marines

SGLI

• Servicemember’s Group Life Insurance

• Covers Marine• Marines must

“opt-out”• Up to $400,000 in

coverage• No proof of health

required• Dangerousness of

job not considered in setting premiums

• All Marines pay the same premium for the same coverage

FGLI

• Family Group Life Insurance

• Covers spouse• Marine must “opt-

out” unless dual-military family; then Marine must “opt-in”

• Up to $100,000 in coverage

• No proof of health required

• All Marines pay the same premium for the same coverage

TSGLI

• Traumatic Servicemember’s Group Life Insurance

• Covers Marine• Not life insurance

– it pays in the event of a traumatic injury

• Details are not covered in this class

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Life Insurance for Active Duty Marines

VGLI

• Veteran’s Group Life Insurance

• Separating or retiring (regular, TDRL, PDRL) Marines who have a current SGLI policy may convert to VGLI at transition

• Maximum policy for the first 5 years is the amount of SGLI coverage

• Marine may add $25,000 additional coverage each 5 years thereafter

• No proof of health required if converted within 240 days of separation / retirement

• Final deadline to convert (with proof of health) is 1 year and 120 days after separation / retirement

• Only age and amount of coverage are considered in setting premiums

S-DVI

• Service Disabled Veteran’s Insurance

• Up to $10,000 in coverage available to any Marine who has a VA rated disability (even 0%)

• If the VA rating is 100% the premiums for the first $10,000 are waived, although Marine must still apply; Marine may also purchase an additional $25,000

• Application form should be sent with IDES findings

Commercial Conversion

• Marines may convert SGLI and / or FGLI to a commercial policy

• Participating providers agree to waive any proof of health requirements

• Premiums will vary – Marines must price shop

• Marines may not convert SGLI to both VGLI and a commercial policy

• Marines may convert both their SGLI and FGLI to commercial policies

• Conversions must occur within 120 days of Marine’s separation or retirement

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Key Point

Conversion of Existing Policy

VGLI and commercial policies are conversions of existing life insurance

Marines who decline SGLI while on active duty can not sign up for VGLI, nor take advantage of the opportunity to convert SGLI to a commercial policy

Marines who decline FGLI while on active duty can not take advantage of the opportunity to convert FGLI to a commercial policy

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Life Insurance for Marines 9

Did Marine have

SGLI?

StartMarine wants… VGLI

No Coverage

Commercial Policy

Marine may not convert; they may shop for private

insurance but will likely need to provide

proof of health

Note: RCCs should encourage Marines who believe they declined SGLI to double-check LES and make sure that premiums were not being withdrawn

Complete SGLV-8714

Review brochure

Apply directly to participati

ng providers

Marine has 240 days to convert with no

proof of health OR 1 year and 120 days to convert with proof of

health

Marine has 240 days to convert with no

proof of health OR 1 year and 120 days to convert with proof of

health

No action required, document clearly in MCWIITS

Click boxes to see the form or brochure; all forms are available on

http://www.benefits.va.gov/INSURANCE/resources-forms.asp

Yes

No

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Key Point

VGLI Eligibility10

If a Marine is not participating in SGLI then the Marine can not participate in VGLI

You qualify for VGLI if you are one of the following:Servicemember being released from active duty who was covered by SGLI, OR

Servicemember separating, retiring, or being released from assignment in the Ready Reserve or National Guard who was covered by SGLI, OR

National Guard or Reserve member covered by part-time SGLI who incurred a disability or aggravated a pre-existing disability while performing inactive duty or traveling to/from duty, OR

Member of the Individual Ready Reserve or Inactive National Guard.

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VGLI Application Requirements

If you separated from service... And You Apply... You Can Be Approved

for VGLI…

before November 1, 2012 within 120 days of separation from service

without having to meet good health requirements

before November 1, 2012

after 120 days from separation from service,

but within 1 year and 120 days

only if you answer the health questions on the

application and you meet good health requirements

on or after November 1, 2012

within 240 days of separation from service

without having to meet good health requirements

on or after November 1, 2012

after 240 days from separation from service,

but within 1 year and 120 days

only if you answer the health questions on the

application and you meet good health requirements

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Key Point

One-Time Window to Convert12

If the Marine does not convert SGLI during the eligibility window there is never another opportunity

A single Marine may not have an immediate need for life insurance; however, the first 240 days after transition may be his or her only opportunity to obtain life insurance without proof of health

As a consequence when he or she starts a family the Marine may not be able to obtain any life insurance at a reasonable rate

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Key Points for Marines Transitioning

Timely Decisions

• Marines will have only 240 days to purchase life insurance without proof of health

• SGLI coverage is automatically extended for only 120 days

Best Price

• Marines may be able to get a better price on a commercial conversion

Consider the Spouse

• FGLI can also be converted, although only to a commercial policy

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Common Pitfalls

Discussion: How can an RCC help avoid these pitfalls?

Life Insurance

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• A Marine’s spouse is the main breadwinner, but does not have sufficient life insurance

• A Marine doesn’t realize they need to convert their SGLI

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Basic Resources Advanced Resources

Resources15

VA Website Insurance PageInformation ♦ Forms

List of Participating Civilian Providershttp://www.benefits.va.gov/INSURANCE

Wounded Warrior RegimentPEB LiaisonDean Trio

703-432-1856

WWR Internal Fact Sheethttps://

ehqmc.usmc.mil/sites/wwr/wrc/Internal%20Slick%20Fact%20Sheets/SGLI-VGLI%20Fact%20Sheet.pdf

WWR External Fact Sheethttps://ehqmc.usmc.mil/sites/wwr/wrc

/External%20Fact%20Slick%20Sheets/SERVICEMEMBERS’%20AND%20VETERANS’%20GROUP%20LIFE%20INSURANCE%20Slick%20Sheet.pdf

Seps/TAPS classVGLI is covered

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16

Knowledge Check

A

D

BC

PFC Thomas, a single Marine is transferred to the TDRL and chooses not to convert his SGLI to either VGLI or a commercial policy. Three years later he is married and wants VGLI coverage. Can he get it?

Yes

No

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17

Knowledge Check

A

D

BC

i

ii

iii

iv

v

Which of the following factors are used to determine the VGLI premiums for an individual Marine?

The Marine’s age

The amount of coverage the Marine elected

The Marine’s DoD disability rating, if any

The Marine’s VA Disability Compensation rating, if any

A only

A and B only

A and C only

C and D only

B, C, and D only

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18

Knowledge Check

A

D

BC

i

ii

iii

iv

v

Cpl Hubbard’s husband, Jim, is covered by FGLI when Cpl Hubbard is medically separated. Jim is the primary breadwinner and is not in good health. The Hubbards want to make sure that he has continued, affordable life insurance. What are their options?Convert the FGLI policy to VGLI

Convert the FGLI policy to a commercial policy

Write the Secretary of the Navy to request a special extension of his FGLI

Have Jim commit a felony so that he can obtain free health care in prison

A only

B only

A and B only

A and C only

B and D only

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19

Knowledge Check

A

D

BC

In 2012 Sgt Brown elected to reduce his SGLI coverage to $200,000. Now he is being transferred to the PDRL. What is the maximum amount of VGLI coverage he can elect for the first five years he is retired?

None

$200,000

$225,000

$400,000

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20

Knowledge Check

A

D

BC

PFC Henderson is transferred to the PDRL on January 1st, 2013. While she did have SGLI she did not convert it to either VGLI or a commercial policy in 2013. In January 2014 she discovers that she is pregnant and decides she does want life insurance. What options are available to her that don’t require a proof of health?

VGLI only

Commercial policy only

Either VGLI or a commercial policy

Neither VGLI, nor a commercial policy; although she can still convert to VGLI with a proof of health

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Questions21