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Long-Term Care Resources for Veterans

Can You Have More Than One Life Insurance Policy?


As a military member, you are automatically enrolled in the Servicemembers Group Life Insurance (SGLI) program unless you opt out. Though SGLI is an affordable term life program, you may have wondered: Can I have multiple life insurance policies? Or, can I keep my SGLI and take out a separate life insurance policy to supplement it?

The answer to both of these questions is yes! There are several reasons why many servicemembers and Veterans choose to have multiple life insurance policies. Read on to learn why it’s wise to invest in additional coverage.

Can You Have Multiple Life Insurance Policies?

Yes, you can have several life insurance policies should you choose to do so. However, this doesn’t mean you’re eligible to get as many policies with as much coverage as your heart desires.

The number of life insurance policies you can have depends on various factors, including your unique circumstances, such as the risks you take as a servicemember, and the insurance providers' own guidelines. Many military members add another policy to supplement their SGLI coverage, as it can provide additional financial protection for their loved ones.

Things to Keep in Mind

It's important to consider your individual needs, budget, and the policy terms you are considering. Before purchasing another policy, take the time to evaluate your existing coverage, including SGLI, to determine if there are any gaps or limitations that a supplemental policy can address. Additionally, compare different insurance providers and policies to ensure you make an informed decision that aligns with your financial goals and plans.

Remember, each policy you have will come with its own premiums, terms, and conditions. It's crucial to carefully review and understand the details of each policy, including any exclusions or limitations, to ensure you have the coverage that suits your specific needs.

Reasons to Have Multiple Life Insurance Policies

After calculating how much life insurance you need, you may find that SGLI would not be enough to sustain your family comfortably if you died unexpectedly. Below are the most common reasons why you may choose to have additional policies.

You need more coverage.

While the SGLI program offers term life insurance at an affordable rate, there may be reasons you need more coverage. For one, SGLI only provides coverage up to a $500,000 maximum. So, if you make $50,000 per year after taxes, SGLI coverage will only provide your family with 10 years of lost income at your current wage — which may not be enough if you have young children.

You want coverage when you leave the military.

When you finish your military service, SGLI extends for 120 days (up to two years if you’re disabled). Before that point, you should purchase a new life insurance policy to continue protecting your family without interruption. Some servicemembers elect to convert to Veterans Group Life Insurance (VGLI), a term life policy that renews every five years — which means it also gets progressively more expensive over time.

AAFMAA can replace your SGLI policy with more affordable coverage than VGLI, and by opting to get a personal policy now, you’ll be ready to transition before your military coverage ends. Don’t forget to protect your spouse and children in the event an unplanned death occurs.

You want to build cash value.

Term life is the most popular type of life insurance because you can get a lot of coverage for a specific period of time at an affordable price, but it’s only half of the story. Most people will outlive their term life policies. Assuming you do, that is a good outcome even though your policy expires without paying out death benefits - but, your family is no longer covered for when you do eventually pass away. To ensure your family always stays protected from your final expenses, you also need some amount of permanent life insurance coverage.

A permanent whole life policy premium never changes, builds cash value, and can transfer wealth to your family, usually tax-free. With so many additional benefits, permanent life insurance premiums are higher, so policies coverage amounts are usually smaller than term.

You need to ladder coverage.

There are certain times when your expenses are higher, which means your life insurance needs are also higher. Rather than take out one sizeable term life policy covering all your expected costs, you may use a technique called “laddering.”

This strategy uses multiple life insurance policies to provide the necessary amount of coverage when you need it. Then as you grow older and your expenses reduce, older term policies naturally expire, reducing your total coverage accordingly and a permanent life insurance plan will continue to provide final expense protection.

You want added long-term care coverage.

Long-term care is expensive, averaging over $50,000 per year, and it costs at least twice that amount for a private room in a nursing home. But some life insurance policies provide extra options to help you cover those expenses. For example, every AAFMAA whole life policy includes a Long-Term Care Settlement Option (LTCSO) at no additional cost. This allows the policyholder to convert the death benefit up to a certain amount into regular, periodic payments before death to help defray the cost of long-term care for the insured.

How to Supplement SGLI with Another Life Insurance Policy

If you decide your best option is to supplement SGLI with another policy, below is a step-by-step guide on how to do this.

  1. Assess your needs: Figure out how much extra coverage you need considering debts, future expenses, and family living costs.
  2. Research: Look into different insurers and policies. Focus on coverage, costs, terms, and the company's reputation.
  3. Consult with an expert: Talk to an insurance advisor about your situation and options. Mention your existing SGLI coverage.
  4. Choose a policy and apply: Be ready to fill out an application and possibly get a medical exam.
  5. Regularly check your coverage: Once you have the new supplemental policy, review it as your life changes to ensure it still meets your needs.
  6. Fully replace your SGLI before you transition out of the military: Once you leave the military your options might be limited and you don’t want to have any gap in coverage.

AAFMAA’s Life Insurance Policies Are Designed for You

When you work with a provider who understands your needs, having an AAFMAA policy comes with Membership benefits that go beyond just life insurance coverage. AAFMAA’s life insurance options are designed specifically for the military community. To determine how much life insurance you and your family need and the best policy options, contact the AAFMAA Life Insurance team at 877-398-2263.

This article was originally published November 23, 2021.