Resources for SGLI

FAQs

Can I cash out my SGLI?

For eligible service members, SGLI is low-cost term coverage designed to protect your family while you serve. It does not build cash value over time, and it expires shortly after you separate from the military. That means you cannot withdraw money, borrow against it, or sell it for cash.

Direct answer: SGLI is term life insurance with no cash value. You cannot cash it out or borrow against it.

What SGLI covers and what “cash value” means

• Death benefit only: SGLI provides a death benefit up to $500,000 while you’re covered.

• No cash value: Only permanent life insurance (e.g., whole life or universal life) builds cash value. SGLI, as term insurance, does not.

What happens after active duty?

• Typical expiration: SGLI generally ends 120 days after your separation date.

• Disability extension: Some veterans with qualifying disabilities may receive an SGLI extension for up to two years.

When your SGLI ends, you have two conversion paths:

• Convert to VGLI: Apply within 240 days after separation to skip proof of good health, or within 1 year and 120 days with proof of good health. Coverage can match your previous full-time SGLI amount (up to $500,000), and you may add $25,000 increments annually if you had less than the max. Premiums are age-based, so costs rise over time.

• Convert to private life insurance: Within 120 days, you can convert to eligible permanent life policies through private carriers without proof of good health. Term life and certain permanent types (e.g., universal life in many cases) are excluded from SGLI conversions; whole life policies are most commonly eligible.

Tip: Whether you choose VGLI or private coverage, remember to update your beneficiaries as life changes.

Whole life vs. universal life (quick view)

• Whole life: Simple, stable premiums, guaranteed coverage, steady cash value growth.

• Universal life: Flexibility to adjust premiums and death benefit, with cash value growth that depends on product design and interest crediting.

Both are permanent, both may include living benefits via cash value. Policy rules differ, so it’s important to review specifics with an agent

Considering private life insurance directly

If you’re in good health, you can apply for private coverage without using military conversion. Choose between:

• Term life: Lower initial cost, no cash value, flexible coverage lengths.

• Permanent life (whole or universal): Lifelong coverage with cash value that grows tax-deferred and can be used while living.

Permanent life policies can build cash value over time; cash can be accessed via withdrawals, loans, premium payments, or full surrender (subject to policy rules and potential taxes). Interest rates and terms vary by company and policy.

If you’re separating soon

• Know your dates: Track your 120-day SGLI end date and the 240-day VGLI window.

• Check your health status: If proof of good health is challenging, conversion can secure coverage.

• Plan your coverage mix: Consider term for cost efficiency plus permanent for cash value and guarantees.

Compassionate help for military families

We serve military families and veterans across North Carolina, Michigan, Ohio, and South Carolina. If you want clarity on your timelines, conversion paperwork, and the right mix of coverage for your family goals, we’re here to help—without pressure.

• Talk with an agent: Get a personalized, values-first plan that fits your budget and your mission.

• Bring your timeline: Separation date, current coverage amount, and beneficiary details.

Disclaimer: This page provides general information, not legal, tax, or personalized insurance advice. Policy availability, eligibility, and rules vary by carrier and the VA. Confirm specifics with the VA, your command, or a licensed agent.

Call to action

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