Nobody wants to think about life insurance, but once it’s secured, it brings a peace of mind.
“It’s something you can put in your drawer and not have to worry about every day,” said Connie Markovich, president and CEO of USBA.
Since its inception in 1959, USBA’s primary target has been serving the military population. At the time, group life insurance for the military maxed out at $10,000 and didn’t include coverage for the service member’s family.
While that has since increased to $400,000, service members lose the benefit – Servicemembers’ Group Life Insurance (SGLI) – four months after leaving the service.
“At that point, early on, we had just a decreasing term product,” Markovich said. “You could get up to $50,000 in the beginning. Then those amounts increased; we added different products over time and expanded from just active duty and retirees to include federal employees and veterans.”
When exiting the service, SGLI options are limited. After that, Veterans’ Group Life Insurance (VGLI) is the next VA option, but the premium increases every five years, whereas USBA offers several alternatives with premiums projected to remain level for longer terms.
USBA plan options
USBA offers 5-, 10-, 15- and 20- year level term plans, meaning the benefit amount service members are insured for remains constant for the stated time period. Under the 10-year level term, policy coverage ranges from $25,000 to $500,000 based on a family’s needs.
“The premium is projected to stay level over that same term,” Markovich said, “but unlike higher priced whole life insurance options, term rates are not guaranteed.”
USBA’s most popular plan, according to Markovich, is their 15-year level term plan because pricing is “right in the middle” of other term plans. The 20-year’s term has increased in popularity over the years.
With all of USBA’s level term plans, the benefit amount remains level for the length of the contract, and premiums are expected to remain level over the specified term.
One of USBA’s more unique offerings is its two-for-one policy, which insures both spouses under one policy and premium. The policy pays on the first person to die, while the other has the option to continue coverage. If both die in the same accident, the policy pays on both.
“Many couples like that security and the convenience of having one policy, one premium, rather than two,” she said. “It is a very popular plan.”
However, Markovich said that in the event of a divorce, each person can continue their coverage under the 5-year level term plan, or they may be able to apply for a different plan altogether. Depending on their health at the time, several competitive options are available.
USBA also offers whole-life options, accidental death policies, a hospital indemnity plan and TRICARE supplements, as well as the decreasing-term policy it has offered since the company’s founding.
Planning for life insurance
Service members should begin looking into post-military life insurance coverage as soon as they start thinking about leaving the service, according to Markovich, for two key reasons.
First, life insurance is based on current age at the time the insurance is issued. So regardless of the type of policy, the older a person is, the higher their premium will be for that same coverage. The other factor is one’s health.
“You never know what’s going to happen down the road,” Markovich said. “The earlier you secure coverage, you’re securing it at a lower rate per thousand than if you’d waited another year … while your health is good – at least that’s the hope.”
In researching what policy will best fit the individual, USBA provides a coverage estimator on its website – a feature that Markovich said has proven to be “helpful, perhaps critical, for those who don’t know where to start.”
“A lot of people don’t want to call somebody,” she said. “There’s a healthy segment of the population that kind of wants to do their own thing and hop on a website.”
The estimator allows customers to determine coverage amounts based on how much they want to pay per month or what type of insurance they can apply for based on the amount they’re willing to pay.
Relationship status is irrelevant
Markovich said it’s important not to let too much time pass between getting out of the service and securing life insurance. Even for people who are young and single.
“It’s not just for married people, and it’s not just for older people,” Markovich said. “Even if you’re young and single – and many are staying single longer now – you still have things like your mortgage, your college loans and credit card debt, obligations you don’t want to pass on to your parents or other loved ones.”
There’s the misconception, she said, that being young and single means life insurance isn’t necessary.
“But there’s often someone who will be responsible for your debts,” Markovich said. “No matter if you’re young or old, married or single, life insurance can help bring peace of mind.”