Life insurance benefits gain increased emphasis Published Oct. 25, 2005 WASHINGTON -- Air Force Reserve Command senior leaders want reservists to know about the importance of Servicemembers’ Group Life Insurance. A recent tragedy involving a reservist who declined SGLI coverage prompted a call for this benefit to receive more emphasis. In addition to requiring reservists to report to their military personnel flight to decline coverage in person, command officials are looking at adding squadron-level counseling by the first sergeant or commander. This increased concern comes on the heels of legislation to increase the maximum coverage, to ensure beneficiaries know when an individual turns down the maximum and to help service members who sustain traumatic war injuries. The $82 billion supplemental legislation signed into law by President Bush May 11 raises maximum SGLI coverage from $250,000 to $400,000 and provides payouts of up to $100,000 for people with traumatic injuries. In a new twist introduced through the legislation, troops with dependents must get their spouse’s approval to purchase less than the full amount of SGLI coverage. In the case of people who are not married, the designated beneficiary will receive notice when the person purchases less than the maximum coverage. Defense and Veteran Affairs officials are working on the details of the expanded benefits. The increased SGLI coverage will start Sept. 1, and the so-called “traumatic SGLI” benefit will begin Dec. 1. The legislation directs that both benefits will be retroactive to Oct. 7, 2001, said Stephen Wurtz, the VA’s deputy assistant director for insurance. Traumatic SGLI benefits will be retroactive for troops who have lost limbs, eyesight or speech or received other traumatic injuries as a direct results of injuries received during Operation Iraqi Freedom or Operation Enduring Freedom. The benefit does not apply to people suffering from disease. The retroactive coverage increase is payable as a result of deaths in either operation, or under other conditions prescribed by the secretary of defense, Mr. Wurtz said. People enrolled in the SGLI program will notice an increase in their premiums when the increases take effect. The traumatic SGLI benefit will be rolled into the basic SGLI program and will likely cost about $1 a month, Mr. Wurtz said. Troops opting for maximum SGLI coverage – $400,000 vs. the current $250,000 – will see their monthly premiums increase from $16.25 to $26, Mr. Wurtz said. This is based on the rate of 6.5 cents per $1,000 of insurance coverage. SGLI coverage is currently available in $10,000 increments, but as of Sept. 1, the increments will increase to $50,000. Because the rates have not changed, people who retain $250,000 or less coverage will see no increase in their premiums, Mr. Wurtz said, except for the $1 “traumatic SGLI” premium. While these expanded benefits will be provided retroactively, affected people won’t be charged retroactive payments, he said. DOD will absorb that cost. The new traumatic SGLI benefit is designed to provide “a quick infusion of cash” for cash-strapped families of troops recuperating from traumatic injuries received in the line of duty, Mr. Wurtz said. Compensation will range from $25,000 to $100,000, and is designed to help families of severely wounded troops leave their homes and jobs to be with their loved one during recovery. “These families incur a lot of expenses, and this is designed to help them financially,” Mr. Wurtz said. VA staff members will consult with DOD to write regulations that will put the new SGLI benefits into effect “Lots and lots of details have to be worked out,” Mr. Wurtz said. Among outstanding issues is the fact that the expanded SGLI coverage is part of the supplemental legislation package that funds operations only through Sept. 30. That’s 30 days after the new SGLI limit takes effect and two months before the traumatic SGLI benefit begins. Mr. Wurtz said the VA is confident Congress will resolve this issue before there’s any lapse in coverage. The VA will continue to oversee and control the SGLI program.