VGLI Explained: Veterans Group Life Insurance Rates, Limits, and Alternatives

What VGLI Is and How It Works

Veterans Group Life Insurance (VGLI) is a renewable group term life insurance program administered by the Department of Veterans Affairs and operated by the Office of Servicemembers' Group Life Insurance (OSGLI) through Prudential. It lets service members who had Servicemembers' Group Life Insurance (SGLI) coverage during active duty, Guard, or Reserve service continue life insurance protection after they leave the military.

VGLI is term insurance only, meaning it has no cash value and pays only a death benefit. SGLI coverage automatically stays in force at no cost for 120 days after separation, and VGLI coverage can begin as soon as 121 days after separation, so applying quickly is the only way to avoid a coverage gap.

The program was specifically created because many veterans cannot easily buy private life insurance after service. It is a low-cost insurance program developed by the VA to provide benefits for service members and veterans who may not otherwise be eligible to receive insurance from private companies due to risks involved in military service or a service-connected disability.

If you are still on active duty and want context on how SGLI feeds into VGLI, our SGLI military life insurance guide breaks down the active-duty side of the program.

VGLI Application Window and the 240-Day Rule

The single most important thing to understand about VGLI is its deadline. Missing it means you lose access to this federally subsidized coverage permanently.

The Two Application Windows

You have 1 year and 120 days (485 days total) from your date of separation from service to apply for VGLI. After this, you are no longer eligible. Within that overall window, there are two very different sub-periods:

If you submit a VGLI application within 240 days following separation from service, you just submit the application along with the first month's premium. You do not need to provide evidence of good health. If you wait past 240 days, you must provide medical evidence and can be declined.

Maximum Coverage and How to Increase It

VGLI provides up to $500,000 of coverage in 2026, with your initial amount tied to the SGLI coverage you carried while active. For example, a service member with $50,000 of SGLI is initially eligible for only $50,000 of VGLI, while one with the maximum $500,000 of SGLI is eligible for the full $500,000 of VGLI.

Coverage is issued in $10,000 increments. The cap was raised from $400,000 to $500,000 by Public Law 117-209, which increased the maximum for service members separating on or after March 1, 2023. Congress also passed the Fairness for Servicemembers and their Families Act of 2025, which now requires the VA to review the $500,000 maximum every five years against the Consumer Price Index for All Urban Consumers (CPI-U). This means future coverage cap increases are more likely to keep pace with inflation, though no automatic increase happens without further congressional action.

Buying Up to the $500,000 Cap

If you separated with less than the maximum, you can build your coverage over time. On the one-year anniversary of getting VGLI, and every five years thereafter, you can increase your coverage by $25,000, up to the $500,000 limit, with no proof of good health required. However, you cannot continue to increase your coverage after age 60.

VGLI Premium Rates by Age (2026 Schedule)

This is where VGLI gets controversial. Premiums are based only on age (not health or sex) and step up every five years. The rate schedule in effect throughout 2026 is the discounted schedule that took effect July 1, 2025, when the VA cut VGLI premiums by an average of 11 percent (with reductions ranging from 2 to 17 percent depending on age band). No additional rate changes have been announced for 2026.

Monthly Premium per $10,000 of Coverage

At age 65, the same $500,000 of coverage that costs $26 per month for those on active-duty SGLI costs $690 per month for veterans on VGLI. Even with the July 2025 discount, the gap between active-duty SGLI and post-separation VGLI at retirement age is enormous.

VGLI vs Commercial Term Life Insurance

For healthy veterans, the math almost always favors private term life insurance over keeping VGLI long-term. VGLI rates are affordable for younger veterans, but maintaining this coverage becomes expensive in later years since rates increase every five years, while a level term policy locks in the same premium for the entire term. Our guide to term life insurance costs breaks down how underwriters price coverage and where you can find the best rates.

Side-by-Side Annual Cost Comparison for $500,000

Based on 2026 market data from MoneyGeek and NerdWallet, a healthy 40-year-old non-smoker in the Preferred Plus health class can lock in a 20-year, $500,000 term policy for roughly $28 to $47 per month for men and $24 to $37 per month for women. Compare that to VGLI's stair-step schedule:

Term life is considerably cheaper than VGLI at every age past 30 for healthy applicants, and the gap widens dramatically after age 50. Learn more about how level term life insurance works to lock in a fixed rate for 20 or 30 years.

If you are exploring private options, our group life insurance guide explains how level term pricing and underwriting work, and our voluntary life insurance breakdown covers employer-offered coverage that many veterans stack on top of a private policy.

Who Should Keep VGLI vs Switch to Private Coverage

The decision boils down to one question: can you qualify for private coverage at a reasonable rate?

Keep VGLI If You...

• Have a service-connected disability or chronic health condition that would make underwriting difficult
• Were diagnosed with cancer, heart disease, diabetes, or PTSD during or after service
• Are a smoker or have a high BMI combined with other risk factors
• Are within the 240-day window but do not have time to shop for private coverage yet (use VGLI as a bridge)
• Need guaranteed lifetime renewability without re-qualifying

If you are medically uninsurable but within 240 days of separating, VGLI will provide up to $500,000 of coverage without a medical exam and stay in force as long as you pay premiums. If you have a service-connected disability rating, also look at VALife (see next section), which offers guaranteed-acceptance whole life. For veterans with PTSD specifically, our life insurance for veterans with PTSD guide breaks down which private carriers are most flexible on approval.

Switch to Private Coverage If You...

• Are under 50 and in good health (non-smoker, no major conditions)
• Want to lock in a level premium for 20 or 30 years
• Need more than $500,000 of coverage
• Want a policy with potential cash value (whole or universal life)
• Plan to keep coverage past age 60, when VGLI rates accelerate

Before switching, it helps to compare life insurance quotes from several carriers, since accelerated underwriting in 2026 can now approve healthy veterans for up to $5 million of coverage without a medical exam.

VALife: The Other VA Option for Disabled Veterans

If you have any VA service-connected disability rating from 0 to 100 percent and are age 80 or younger, you are eligible for Veterans Affairs Life Insurance (VALife), the guaranteed-acceptance whole life program launched January 1, 2023. As of January 2026, VALife provides more than $2.2 billion in coverage to over 70,000 enrolled veterans.

VALife offers up to $40,000 of whole life coverage in $10,000 increments with no medical exam or health questions. The catch is a 2-year waiting period before the full death benefit takes effect (during that window, beneficiaries typically receive only a return of premiums plus interest).

Important 2026 S-DVI Transition Rule

If you already have Service-Disabled Veterans Insurance (S-DVI) and apply for VALife on or after January 1, 2026, your S-DVI ends the day VA approves your VALife application, including any premium waivers. You will pay only VALife premiums during the 2-year waiting period, but you will not have full VALife coverage yet. Veterans who applied by December 31, 2025 were grandfathered into a temporary dual-coverage window during the 2-year waiting period.

VALife's $40,000 cap makes it a supplement, not a replacement, for VGLI in most cases. Many disabled veterans carry both.

Converting VGLI to a Commercial Whole Life Policy

VGLI gives you one unique advantage that civilian term policies usually do not: a guaranteed right to convert to a commercial permanent policy without health questions, at any time while your VGLI is active.

For the current VA-approved list (per Form SGL-133), the participating conversion companies are American Fidelity Life, EMC National Life, Guardian, Life Insurance Company of Alabama, MassMutual, MetLife, New York Life, Northwestern Mutual, Prudential, and Trans World Assurance. Note that Guardian, New York Life, and Northwestern Mutual participate for whole life only. The converted policy must be a permanent plan (whole life), not term or universal life, and the face amount cannot exceed your current VGLI coverage.

How VGLI Conversion Works

1. Confirm your VGLI is active and premiums are current
2. Choose a participating conversion company from the VA's official list
3. Request your VGLI conversion notice through your OSGLI online account
4. Apply at a local agent's office for that company's designated permanent product
5. Submit your DD-214 (or equivalent separation document) with the application

Premiums will be based on your age at conversion and stay level for life, unlike VGLI's stair-step rates. Once you convert, you cannot go back to VGLI. To decide whether conversion makes sense, review our breakdown of whole life insurance costs and benefits.

Beneficiary Rules for VGLI

Veterans have complete freedom to designate the beneficiaries of their VGLI policies, and once designated, a beneficiary is not set in stone. You can update your beneficiaries at any time to match your circumstances.

You can name almost any person or entity, including a spouse, child, partner, friend, trust, charity, or your estate. You can also name multiple primary and contingent beneficiaries with specified percentages.

Default Order If No Beneficiary Is Named

If a veteran fails to designate a beneficiary and passes away, VGLI benefits are paid out in this order:

1. Surviving spouse
2. Child or children equally (with a deceased child's share going to their descendants)
3. Surviving parents equally, or the surviving parent
4. The executor or administrator of the estate
5. Next of kin under state law

Review your designation after every major life event. Marriage, divorce, the birth of a child, or the death of a previously named beneficiary all warrant an update.

How to Enroll in VGLI

Enrolling is straightforward if you act on time. There are three ways to apply:

1. Online through the OSGLI/Prudential portal at giosgli.prudential.com (fastest)
2. By mail using SGLV Form 8714 sent to OSGLI, PO Box 41618, Philadelphia, PA 19176-9913
3. By fax to 1-800-236-6142

Within roughly 45 to 60 days of your separation date, OSGLI will mail you a VGLI application packet. If you do not receive one, do not wait. Apply directly online.

You will need your separation date, your final SGLI coverage amount, beneficiary information, and your first month's premium payment. Coverage typically takes effect 121 days after separation (the day SGLI ends) if you apply during the preferred window.

Frequently Asked Questions

Is VGLI worth keeping long term?

For healthy veterans, usually not. VGLI's age-based premium increases make it dramatically more expensive after age 55, while a fixed-rate 20 or 30-year term policy from a private insurer locks in a much lower rate. VGLI makes the most financial sense for veterans with service-connected disabilities or health conditions that would result in rated or declined private coverage.

Can I have both VGLI and a private life insurance policy?

Yes. There is no rule preventing you from carrying VGLI alongside one or more private term or whole life policies. Many veterans use VGLI as a bridge during the first year after separation while shopping for a permanent private solution, then either keep both or drop VGLI once the private policy is in force.

What happens if I miss the 1-year-and-120-day VGLI deadline?

You permanently lose eligibility for VGLI. There are no extensions outside of rare federally declared events. If you missed the window, your remaining options are private life insurance through underwriting, guaranteed-issue policies (which are expensive and limited), or VALife if you have a service-connected disability rating.

Are VGLI premiums tax deductible?

No. Premiums you pay for personal life insurance coverage, including VGLI, are not tax deductible on your federal income tax return. However, the death benefit your beneficiaries receive is generally income-tax-free, which is the standard tax treatment for life insurance proceeds.

Can I lower my VGLI coverage if premiums become unaffordable?

Yes. You can decrease your VGLI coverage amount in $10,000 increments at any time, or cancel the policy entirely. Many older veterans gradually reduce coverage rather than drop it completely, especially after they have paid off a mortgage or their children reach financial independence. Just be aware that you cannot increase coverage again after age 60.