Comparing Veterans’ Group
Life Insurance (VGLI) to Whole
Life Insurance Coverage
Life insurance can be confusing. One of the most common questions we get from Servicemembers and Veterans is,
what type of life insurance is Veterans’ Group Life Insurance (VGLI)?
The easy answer to that question is, Veterans’ Group
Life Insurance coverage is term life insurance, which
is very different from, and often is confused with,
another common type of coverage called whole life
insurance. We want to make sure you understand the
differences between term and whole life coverage
so you can make an informed decision about which
coverage is best for you.
To help explain the differences, we put together the
facts and features about both below. This information
is not intended to persuade or promote one type of
coverage over the other – it is just a list of features:
Features of term life insurance
• Provides death benets only, there is no cash value
that builds over time
• Only pays a death benet if the coverage is in force
when the insured dies and premiums must always
be paid to keep the coverage in force
• A health exam may be required to obtain coverage,
but can generally be renewed without proof of
good health
• Usually the most affordable life insurance to buy
• Purchased for a specic time period, during which
time the premiums remain level. After this level
premium period, the premiums increase until
a certain age is reached at which time the
coverage ends.
• Becomes more expensive as you age, especially
after age 50
• Death benet is intended to replace income
• Often includes a provision which allows the term
policy to be converted to a permanent policy
without medical underwriting.
Features of whole life insurance:
• Provides death benets as well as a cash
value accumulation that builds during the life of
the policy
• Whole life insurance premiums are generally higher
at younger ages than term life insurance premiums,
but they but remain level for the life of the policy
• A health exam may be required to obtain coverage
• Sometimes can be purchased without a medical
exam, but possibly at a higher cost
• Cash value is based on how long the policy has
been in force
• A portion of the cash value can usually be
withdrawn or borrowed against during the life of
the policy
GL.2021.056 NOT11_FL_GI449_01
How does VGLI differ from other term life insurance policies?
• VGLI allows you to continue your Servicemembers’ Group Life Insurance (SGLI) coverage after you separate from
service, but you must enroll within one year and 120 days from discharge or separation in order to be eligible to
continue coverage.
– Veterans who submit their application within the rst 240 days of discharge or separation can get VGLI without
providing proof of good health — even if you have a serious injury or medical condition.
– Those who apply more than 240 days after discharge or separation are required to answer health questions and
must meet good health requirements in order to qualify for VGLI coverage.
– After 1 year and 120 days, you are no longer eligible to apply for VGLI.
• VGLI coverage can be renewed every ve years and does not terminate, so long as premium payments are paid in a
timely manner. There is no age limit or term limit to the coverage.
• Like other term policies, your premium amounts will increase as you get older.
• You can convert your active VGLI coverage to a commercial whole life insurance policy at any time without the need
to provide evidence of good health.
• You can periodically increase your coverage amount by $25,000 up to the legislated maximum of $400,000, until
age 60. No proof of good health is required, and we will notify you when you are eligible.
• Accelerated Benet Option (ABO) – The Accelerated Benet Option under VGLI coverage provides terminally ill
insureds access to a portion of the death benet while they are still living. To qualify, the Veteran must be terminally
ill and have a valid written prognosis from a physician that they have nine or fewer months to live. The Veteran can
apply to receive a one-time, lump-sum payment, up to 50 percent of the face value of the insurance to use however
the Veteran chooses.
What to Consider when Choosing Between Life Insurance Coverage through VGLI or
other Whole Life Insurance Commercial Carriers
If you are separating from military
service and Then you may want to consider VGLI
Then you may want to consider other
commercial or VA whole life policies
You have health conditions or
disabilities that may affect your
ability to get
an individual policy with a
commercial insurer
X
You want your premiums to remain
the same for the life of the policy
(even if they are higher)
X
You want to skip a health
questionnaire to determine
eligibility for life insurance
X*
You want to ensure that there
is a death benet payable to a
beneciary
X X
You are interested in a life insurance
policy that has cash or loan value
X
*Only if you apply within the rst 240 days from date of separation from active service.
