Life Insurance is a big part of a person’s financial portfolio, but many don’t think about it. We all think we are young and it isn’t needed. Then, before we know it, we are older, have families, and realize how important it is. We start to realize that if God forbid something happened to our spouse, we would be hard pressed to get by without their income. By the time we figure all this out, it’s gotten more expensive, due to age and our health and habits. This is especially true in the military community.
In military families, there are many instances where the service member is the only one with an income. The spouse either stays home with the kids or isn’t steadily employed with the frequent moves. What happens if something happens to the service member? We all figure we’ll be fine with SGLI. Maybe so, but supplemental insurance is still a good idea.
Life insurance increases 8-10% for every year you put off buying it. This tends to increase the older you get. That’s the best reason to buy it while you are young. If you plan to stay in the military until retirement, you’ll be in at least, your late thirties. Premiums tend to dramatically increase from age 40 to 50. If you buy a 30 year policy around age 30, when you are married and are working on your family, you’ll be set.
Military life is also extremely unpredictable. People don’t always realize that SGLI is only good while you are active. The same goes for FSGLI. There are so many things that can happen to quickly put you out of the military. Whether it be an injury or just reducing the number of active duty, your plan to stay for retirement is not always the case.
Injuries in the military can greatly affect your ability to get life insurance. It’s no secret that my husband was diagnosed with PTSD. Some companies will straight up ask if you have it, while others will figure it out when they do the medical exam. That, combined with other health problems that are mostly related to the military, gave us monthly premium costs that were not affordable for us. I’m talking new car payment size premiums.
VGLI does offer coverage with no medical questioning, if you enroll within 240 days of your separation date. I wasn’t aware of this in time though, so we missed out. If you have disabilities that prevent you from working, including some service connected disabilities, you might qualify for an extension of SGLI. There is also an option to convert you SGLI over through a private company, but it must be done within 120 days. VGLI rates can be found here. For the husband, it would have been $68 a month, which is much more affordable than the other quotes I was given. The key here is that a person must know about it and take advantage in time.
Not all private insurance companies cater to the military. Many have clauses that they won’t pay for a military related death. USAA is the way to go in my opinion. They offer quick, no medical exam coverage before deployments. They also offer severe injury benefits, much like SGLI does. The best thing though, is once you separate from active duty, you can purchase more insurance with no additional medical exam. That would have been helpful in our situation.
Not everyone needs life insurance, mostly if you are single with nothing to your name, but once there are people relying on you, it’s necessary.