Why Military Spouses Should Consider Supplemental Life Insurance and Where to Get It

Military life is a transient life. My husband and I move frequently, often without a final say in where we go, which makes planning for the future pretty difficult. However, making long-term financial decisions is still crucial no matter where you are in the world.

After our daughter was born while we were stationed in Germany, I worried that the VA-provided life insurance policy for military spouses wouldn’t offer enough financial security for our family if something happened to me. So, I started investigating what supplemental options are available, including policies available from private companies. 

If you’re a military spouse in a similar situation, here’s a deep dive into some of your life insurance options. Read on to learn about life insurance provided by the VA, how to tell if it’s enough coverage for your family and how to shop for supplemental insurance.

What Life Insurance Does the VA Offer Military Spouses?

Life insurance provides a payment to your beneficiaries when you die. The death benefit can be used to pay for funeral costs and end-of-life expenses, paying off debts, funding your family’s day-to-day lifestyle, college expenses and more. If you’re a stay-at-home parent, life insurance can help cover the at-home labor you would’ve done otherwise, too. Your family may need to pay for childcare and hire service providers to replace your workload, after all.

Service members can get life insurance coverage through Servicemembers’ Group Life Insurance (SGLI). Service members are automatically signed up for the maximum coverage amount of $500,000, although they can choose to decline or reduce the coverage. SGLI is active while they are on active duty and for 120 days after they separate or are released from the military.

The VA also offers Family Servicemembers’ Group Life Insurance (FSGLI) that provides up to $100,000 in coverage for spouses of service members who are covered by SGLI. Similarly to SGLI, you would automatically start at the highest coverage unless you choose to reduce the amount, but you can’t have FSGLI coverage that exceeds the service member’s SGLI coverage. 

Civilian spouses are automatically enrolled in FSGLI coverage, and premiums are automatically taken from the service member’s pay. Military spouses married on or after January 2, 2013 aren’t automatically enrolled, but can have the service member sign them up for FSGLI. You can be covered by SGLI and FSGLI at the same time, though there is a cap on your total combined coverage, which changes year to year. Dependent children can also qualify for up to $10,000 in coverage under this plan, and their coverage is free. You may be eligible for FSGLI coverage if your partner is: 

• Active duty and covered by full-time Servicemembers’ Group Life Insurance (SGLI), or

• A member of the National Guard or Ready Reserve and covered by full-time SGLI

Your monthly premiums for FSGLI for spouses are based on the coverage amount and your age. When you’re under 35 years old, the premium for $100,000 in coverage is $4.50. If you’re 45-49 years old, it’s $10. If your service member passes away, leaves the military or divorces you, you have 120 days to convert your policy to a permanent, individual policy with participating life insurance companies. At that point, you would be responsible for paying premiums yourself.

Why FSGLI Coverage May Not Be Enough 

A common guideline is to get a life insurance policy that’s worth ten times your salary. So, earning $50,000 per year would mean you would need a policy worth $500,000. If that number shocks you, don’t worry—it’s just a rule of thumb. How much you actually need in coverage depends on your finances, responsibilities and family size. 

Servicemembers may get perks like mostly free healthcare, subsidized childcare, housing allowances and college education benefits that may be transferable to their children. These benefits may lessen a servicemember’s financial burden when a spouse dies. However, for larger families with dual incomes, $100,000 in coverage may fall short even with those military benefits, in which case you could consider supplemental life insurance to cover the gap. 

How to Supplement Your Life Insurance Policy

Supplemental life insurance is a policy that “supplements” your existing life insurance policy with additional coverage, such as a higher death benefit. By reaching out to the VA, I was able to confirm that there isn’t a supplemental insurance option you can purchase from them directly. 

However, the VA does recommend resources like Military OneSource, which provides free financial coaching to help military families deal with money issues, and coaches may be able to help you evaluate financial products such as life insurance policies. Individual installations may also offer on-site support you can use for help when making money decisions. 

Non-profit organizations like the American Armed Forces Mutual Aid Association (AAFMAA) and Military Benefit Association (MBA) provide life insurance policies that cater specifically to military families, and both organizations offer policies with coverage up to $1 million. 

Military families sometimes have particular needs when it comes to life insurance: First, it can be harder to get approved for life insurance if you’re likely to be deployed or are involved in high-risk activities. Service members’ spouses may not carry that same risk, but they’re more likely than the general population to be out of the workforce. 

If you’re a military spouse who works, compare options to find the best fit. Aside from military-focused organizations, you can expand your life insurance search to check coverage options with private companies like Fabric. Depending on the service member’s job duties and location, they may be able to get approved for life insurance through a private company, too. 

Some private companies may actually offer lower premium rates than policies through military organizations. As of August 10, 2023, a 36-year-old, non-tobacco using Active Duty/Guard/Reserve service member would pay $34.10 for a $500,000 policy through the MBA, whereas Fabric’s quote for a 36-year-old nonsmoking man is $25.52 for a 20-year, $500,000 term policy.

Final Word 

As military spouses, our fears about death often relate to our spouses and worries about the worst that could happen to them while they’re away. However, we also play important roles as supporters, care providers and income earners in our families. Not having us around can put an emotional and financial strain on the family we leave behind.  

The VA offers life insurance coverage for spouses. Still, it’s worth reviewing your annual salary and financial obligations to determine whether the group coverage is enough to help give you peace of mind. If not, shopping for and purchasing supplemental insurance could be the way to go.  

Fabric exists to help young families master their money. Our articles abide by strict editorial standards.

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