Should you cancel your SGLI before you separate?

LTC Private RallyPoint Member — Wed, 17 Jun 2015 20:13:50 -0400

An S1NET message stated that "some Personnel Officers are advising Servicemembers to cancel their [SGLI] coverage months or weeks before their separation date in order to save on premium payments. This is not good advice."

https://www.milsuite.mil/book/docs/DOC-208614. CAC-enabled.

Leaders should recommend that their SMs maintain their SGLI coverage through ETS. In the Reserve Component, SMs frequently stop coming after receiving their ETS orders, thereby neglecting to pay SGLI premiums for the interim months.

Has anyone heard a leader or S1 advising that SMs cancel their SGLI? Has anyone corrected this bad guidance?

Response by PO1 John Miller made Jun 17 at 2015 8:15 PM

PO1 John Miller — Wed, 17 Jun 2015 20:15:43 -0400

I have never heard of this, and I would discourage it as well. What if a member is involved in a fatal accident on their last day of terminal leave? If they still have SGLI, their family is taken care of!

Response by SFC Private RallyPoint Member made Jun 17 at 2015 8:27 PM

SFC Private RallyPoint Member — Wed, 17 Jun 2015 20:27:36 -0400

Wow. That is some really bad advice. I can't believe anyone would recommend that.

Yes. Sometimes when a Soldier ETS's and moves to NG/Res they just stop showing up. They incur a debt against the gov for unpaid SGLI payments. Eventually it will catch up with them when they do their taxes.

Also in my unit. If a Soldier fails to show up we code them AWOL. Once they miss a certain amount of drills a warrant is sworn out against them. Those warrants never go away. I had to go to court once for a Soldier that had 2 outstanding warrants on him from over 8 years. 1 for AWOL, and 1 for theft over $2500 (issued gear). It wasn't pretty.

A lot of AD Soldiers transitioning put sometimes get some bad info from their Career Counsleors while transitioning. It is really frustrating at times.

Response by Capt Private RallyPoint Member made Jun 17 at 2015 8:30 PM

Capt Private RallyPoint Member — Wed, 17 Jun 2015 20:30:35 -0400

I sold life insurance for a year. One day I had a doctors appointment. When I left the appointment I was uninsurable. I could not even sell myself a policy. Yes, it happens that fast.

One should never cancel a policy until alternate coverage is obtained. And SGLI in at least some cases (if not all) can be converted to VGLI.

Response by SSG Private RallyPoint Member made Jun 17 at 2015 9:28 PM

SSG Private RallyPoint Member — Wed, 17 Jun 2015 21:28:58 -0400

Not no, but hell no! Why would you tell someone to cancel their premiums.

I hope someone does tell a service member to cancel their premiums and I hope it weighs really heavy on their conscience should that service member die before that separation date.

Personnel Officers should advise any member who may be considering cancelling their SGLI coverage about the negative consequences listed below:

**EDIT, got to represent the NCO Corps, that S1 or Readiness NCO, Admin NCO at unit level, better square any Soldier contemplating canceling their insurance. But alas to each is own. Sorry it makes me cringe***

* Cannot receive 120 days of SGLI coverage at no cost following separation from service (a benefit that all Servicemembers receive when they separate with SGLI coverage intact).

* Cannot apply for an additional two years of SGLI coverage at no cost through the SGLI Disability Extension Program if they are totally disabled.

* Cannot obtain Veterans’ Group Life Insurance (VGLI) coverage, which is available without proof of good health for 240 days after separation and can be retained for life.

* Will be cancelling Family SGLI Coverage for his/her spouse and children for the member’s remaining time in service and for the 120-day free period after separation.

* Will be cancelling SGLI Traumatic Injury Protection (TSGLI) and cannot receive a TSGLI payment for qualifying traumatic injuries that occur prior to separation.

If you really need to save $30 bucks then feel free I guess, but be careful what you ask for.

Response by COL Private RallyPoint Member made Jun 17 at 2015 9:30 PM

COL Private RallyPoint Member — Wed, 17 Jun 2015 21:30:22 -0400

Insurance is about risk. If people choose to buy insurance it is to invest against the risk of health problems, property loss or death. A person should never buy more insurance than they can afford and if they have to make a decision about insurance, it should be an informed decision. I would never recommend anyone of cancelling insurance to save on premiums but would recommend not to cancel until they are no longer eligible, have replacement insurance or decide against insurance. But insurance is a choice and in the case of life insurance the insured never collects.

Response by SSG Roger Ayscue made Jun 18 at 2015 12:07 AM

SSG Roger Ayscue — Thu, 18 Jun 2015 00:07:47 -0400

I kept mine after I retired. NO do not cancel it before you get out, even if you do not convert it to VGLI (Veterans Group Life Insurance) is is still coverage until you finish transition.

Response by 1SG Private RallyPoint Member made Jun 18 at 2015 12:12 PM

1SG Private RallyPoint Member — Thu, 18 Jun 2015 12:12:02 -0400

This holds the same logic as quitting a job before you have even interviewed for another one.

Response by SFC Private RallyPoint Member made Jun 18 at 2015 12:43 PM

SFC Private RallyPoint Member — Thu, 18 Jun 2015 12:43:46 -0400

I think someone needs to get slapped upside the head for telling Soldiers this, just plan wrong!!

Response by SFC Joe S. Davis Jr., MSM, DSL made Jun 19 at 2015 5:45 AM

SFC Joe S. Davis Jr., MSM, DSL — Fri, 19 Jun 2015 05:45:01 -0400

No, SGLI is good for 120 days after you seperate. Then you can get VGLI- paying a good price for term insurance with Prudential.

Response by LTC Private RallyPoint Member made Jun 20 at 2015 4:05 PM

LTC Private RallyPoint Member — Sat, 20 Jun 2015 16:05:14 -0400

Update: Army Directive 2015-23 establishes uniform policy on SGLI cancellation and fund recoupment. Army Reserve Soldiers found to be unsatisfactory participants must be notified in writing that their SGLI will be terminated and any unpaid premiums will be recouped from them.

http://www.apd.army.mil/pdffiles/ad2015_23.pdf

Response by SFC Maury Gonzalez made Jun 20 at 2015 4:40 PM

SFC Maury Gonzalez — Sat, 20 Jun 2015 16:40:55 -0400

That's the stupidest advice i ever heard, sgli is good until vgli kicks in or you new career insurance starts. If you are getting that advice from some CSM i sure hope they not pressuring you to buy crappy ncoa or ausa life insurances

Response by Lt Col Charlie Brown made May 4 at 2020 7:42 PM

Lt Col Charlie Brown — Mon, 04 May 2020 19:42:26 -0400

That's definitely the wrong advice