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Life Insurance

How Long Does My SGLI Coverage Last After Retirement?


When you retire from active-duty military service, your Servicemembers' Group Life Insurance policy (SGLI) ends 120 days later. Retiring servicemembers are presented with the option to convert their SGLI into a Veterans' Group Life Insurance policy, or VGLI.

Does SGLI Automatically Convert to VGLI?

SGLI does not automatically convert to VGLI when you retire. Servicemembers have 120 days after they’ve transitioned out of the military to apply for VGLI. You can still apply up to a year after that period, but evidence of good health is required with your application.

How Does VGLI Compare to Other Life Insurance Available to Veterans?

A VGLI policy offers the same amount of coverage that the servicemember had with SGLI while they were on active duty, without requiring medical exams or answering countless health questionnaires. While VGLI may not have the same hoops to jump through as an underwritten policy from a private carrier, it comes at a much higher monthly cost that progressively escalates as you get older.

The premiums for a VGLI policy are based on the separated servicemember's age at the time of transition. Suppose the Veteran decides to opt out of converting their SGLI into a VGLI and instead allows the policy to lapse. In that case, they will no longer have any life insurance coverage to protect their family if they were to pass away during retirement.

SGLI vs. VGLI Premiums

  • Everyone who qualifies for SGLI pays the same premium (6 cents per $1,000); VGLI premiums are based on an individual Veteran’s age.
  • SGLI coverage can be purchased in increments of $50,000 up to $400,000; VGLI coverage can be purchased in increments of $10,000 up to the amount of SGLI coverage you had when you left the military. If that amount was less than the maximum $500,000, you can purchase an additional $25,000 of coverage every five years until age 60.
  • While SGLI premiums remain the same, VGLI premiums are based on age and increase every five years. If you keep VGLI through your late 50s, your premiums will be 10 times more than what you paid when you had SGLI. By the time you’re in your 80s, it’s 75 times more.

Are There Other Life Insurance Policies Dedicated to Veterans?

VGLI is not your only life insurance option. That’s why there are insurance providers like AAFMAA who offer quality insurance policies created with military members in mind.

VGLI Alternatives

Two excellent (and less expensive) alternatives to VGLI offered by AAFMAA are Level Term II and 5-Year Renewable Term. These policies both offer:

  • Premiums that remain the same throughout the policy term and never increase.
  • $50,000-$800,000 coverage.
  • Survivor Assistance Services.
  • Premium prices are up to 75% less than VGLI.

AAFMAA also offers Wealth Builder Life Insurance, a comprehensive policy consisting of one plan with four retirement solutions that help secure a healthy financial future for you and your family. Those solutions are:

  1. Permanent life insurance coverage, which grows a cash value.
  2. The ability to convert cash value into a stream of income and create your own pension with no fees.
  3. A long-term care settlement option.
  4. The ability to take out a policy loan or even surrender the policy and receive the cash value penalty-free.

Remember, converting your SGLI after retirement to VGLI is not your only option, nor is it necessarily the best option. AAFMAA provides services that are specifically designed for both active-duty and Veteran military members. Be sure to do your due diligence before committing to any policy.

Set Yourself Up for Success in Retirement with AAFMAA

AAFMAA helps military members like you build a successful, financially secure life for themselves and their families. If you’re wondering, what to replace your SGLI with after retirement, we’ve got that answer and more. Our team of professionals are committed to helping you find the best policy. If you’re thinking about a life insurance policy or just have questions, contact AAFMAA today at 866-631-1319 or get a free quote for coverage right now.