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Congress makes increase in SGLI coverage permanent

By Cpl. C. Alex Herron | | October 21, 2005

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On Sept. 28 Congress signed the Service Members Group Life Insurance Act of 2005, which made the temporary $400,000 maximum life insurance coverage enacted earlier this year an automatic, permanent change for armed forces members.

The initial change was made during the summer of 2005 to recognize the loss of a service member with dignified and appropriate support for family members left behind, according to an Armed Forces Press Service Press Release.

Along with the increased coverage, the new SGLI bill requires a service member’s spouse to be notified in writing if someone other than the spouse is named as a beneficiary or less than maximum coverage is chosen.

“Within 30 days of the member making the election, the spouse will receive a letter from the Air Station commanding officer stating that they are not named as the primary beneficiary, but will not be told who was named,” said Chief Warrant Officer 4 Mark J. Howard, the director of the Installation Personnel Administration Center. “Although the spouse will not be able to change the designation, at least they will be made aware of the situation.”

Senator Robert Craig, R-Id., hopes the notification requirement prompts families to talk about finances and what might happen if a service member is killed.

Understanding the rules and regulations for SGLI is imperative to making an informed decision in regards to Marines’ families, according to Howard.

“There have been instances where surviving spouses were left without the resources to take care of their children because the service member designated the couples’ children as the recipients of the SGLI,” Howard said. “If a minor child is designated as the recipient the money may stay out of reach until they are 18 years old.”

Although money will not ease the pain of losing a spouse, the money does ease the transition by providing for the family left behind with the best financial means possible, according to Howard.

“Service members need to be prepared for the unexpected,” Howard said. “Part of the preparation is to look after their family member’s finances in the event of their death. The increased coverage will help surviving family members cope with the loss of a loved one by putting them in a more stable financial position. Not understanding the impact of who is chosen as a beneficiary can cause untold heartache and financial difficulties for surviving families.”

Another change to SGLI coverage is the increments in which troops can select coverage. Instead of using $10,000 increments, now service members will select coverage in the amount of $50,000.

The cost for full coverage for $400,000 is $26.00 per month. If a service member wants to elect a reduced coverage they need to see their servicing administration office and communicate their desires in person. For those who do not want to change their current beneficiaries and do not want to change their level of coverage, no action needs to be taken.

For more information about the changes in SGLI contact Howard at 228-8410 or the legal assistance office at 228-7330.
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