Veterans and military guide to insurance

Veterans and those still serving our country in the military often are eligible for insurance discounts and privileges. However, they can also face special challenges.

Understanding both the perks and pitfalls of buying insurance as a soldier can help you to maximize protection while minimizing costs.

“Some insurers specialize in insuring veterans, and they should always be included on the shopping list,” says Lynne McChristian, a spokesperson for the Insurance Information Institute. “These insurers understand the complexities of military life and they also understand that customer service is important to those dedicated to military service.”

Whether you’re deployed or have completed your service, you need auto, home, life and health insurance. This comprehensive guide full of insurance tips for veterans and military personnel can help you and your family make an informed decision and find the right coverage.

How military insurance is different

Just about everyone requires insurance, but needs can be different for members of the military.

For example, when you are deployed overseas, paying your insurance bills is the last thing you want to worry about. It might be helpful to find an insurer that allows you to pay bills automatically from your bank account, and that lets you renew policies early.

In addition, if you are deployed outside the U.S. and your car is sitting inside a garage for months on end, you might want to suspend your auto insurance coverage. If family members will drive the car while you are away, you might want to at least remove your name from the policy. Ask your insurer about these options.

If you take personal items with you during a deployment, will your homeowners insurance cover those items? Ask your insurer. Also, if you leave your house vacant for a long period of time while you are deployed, will your homeowners insurance remain in force?

And don’t forget to ask about health insurance and life insurance. If you are a member of the National Guard and are being deployed, does your workplace health insurance still cover you? Do you have the appropriate amount of life insurance in place for someone who is in a higher-risk category, such as a member of the military deployed to a combat zone?

These are just some of the questions to ask yourself — and your insurance agent — if you are a member of the military.

Best car insurance companies for veterans

While veterans can get excellent coverage through many different insurers, a handful of companies with military discounts cater to the needs of those who have a history of service.

USAA is known for providing excellent service to veterans and active-duty military members. The company specializes in serving these folks and their families.

However, other companies also offer perks for those with military ties. For example, Direct Auto Insurance offers up to 25% off key auto insurance coverages if you are an active-duty member of the military.

Geico also offers up to a 15% discount on your insurance premium if you are a member of the military or a veteran.

See the next section for more companies that offer discounts to veterans and active-duty members of the military.

Which companies offer military discounts?

Here’s a sampling of insurers that offer auto discounts to veterans and military personnel.

• AAA: Membership discounts offered in certain regions
• Direct General: Up to 25% discount for active service members
• Geico: Up to 15% discount off your premium
• USAA: Offers a host of discounts, include 15% discount on on-base auto insurance.

Although service members and veterans will want to weigh these discounts when shopping for a policy, they also should look at other factors when choosing an insurer, McChristian says.

“Insurance considerations should not be based on price alone,” she says. “You will want to look into the customer satisfaction ratings and how well the company is rated for financial stability.”

Auto insurance for veterans and military personnel

Car insurance coverage options include:

• Liability coverage: Required by nearly every state, this coverage provides bodily injury liability and property damage liability protection to cover harm or damage to other motorists if you get into an accident.

• Collision/comprehensive coverage: Provides coverage for damage or bodily injury to you and your car, along with other motorists.

• Uninsured/underinsured motorist coverage: Covers bodily injury or damage to you and your car if the driver is uninsured and is responsible for the accident.
• Medical payments and personal injury protection (PIP) coverage: This type of insurance, which isn’t required in all states, provides coverage for medical expenses, loss of income and other designated costs for injuries sustained in an accident, regardless of who’s at fault.

Auto insurance options if you are deployed

Your coverage needs will likely change if you’re deployed. But McChristian says skipping insurance altogether can be foolish.

“Leaving a car uninsured leaves it vulnerable to loss. A car can still be damaged in storage,” she says. “So, it may be wise to maintain comprehensive coverage, but drop the types of coverage related to cars being on the road, such as liability and collision coverage.” Here are six options to consider:

Life insurance for veterans and military personnel

Life insurance comes in two forms: term life and permanent life, which includes whole life.

Term life insurance provides coverage for a specific period (typically anywhere from five to 30 years) and expires at the end of the term. Whole life insurance, which is more expensive, never expires and comes with a cash value component. Cash value lets a policyholder tap into money from a life insurance policy while alive.

Whether you want a term or whole life policy, serving in the military comes with higher risk. This often leads to higher private life insurance rates for service members. However, government programs are available to assist you with affordable life insurance coverage.

Here are some of those programs:

Active Service Members

• Servicemembers’ group life insurance (SGLI): Offers up to $400,000 of life insurance coverage for service members who meet eligibility requirements. That includes being an active-duty member of the Air Force, Army, Navy, Marines or Coast Guard, or a Reserve Officers Training Corps (ROTC) member, cadet, or midshipman involved in authorized training. Coverage costs 6 cents for every $1,000 of coverage.
• Family Servicemembers’ Group Life Insurance (FSGLI): Provides life insurance coverage to spouses and dependent children of active-duty military personnel and National Guard and Ready Reserve members covered by full-time SGLI. Maximum coverage is $100,000 for a spouse and $10,000 for each dependent. The premium for spousal coverage increases with age, but dependent children get free coverage generally up to age 18.
• Servicemembers’ Group Life Insurance – Disability Extension (SGLI-DE): Service members who are disabled when they’re discharged can access SGLI coverage for free for up to two years.
• Servicemembers’ Group Life Insurance Traumatic Injury Protection (TSGLI): Provides short-term coverage of between $25,000 and $100,000 for service members with a qualifying traumatic brain injury who were previously covered under SGLI. The premium for TSGLI is a flat rate of $1 month.

Veterans

• Veterans’ Group Life Insurance (VGLI): Service members with SGLI coverage can transition to this coverage at the end of their military career when they need life insurance for veterans. However, there are time limits on when you’re eligible — generally within one year and 120 days of when your service ends.
• Veterans’ Mortgage Life Insurance (VMLI): Service members who have a severe military-related disability and have adapted a home to meet their needs can qualify for this mortgage life insurance. This coverage, which maxes out at $200,000, can’t exceed the amount you still have left on your mortgage.
• Service-Disabled Veterans’ Insurance (S-DVI): Provides coverage of up to $10,000 to veterans who received a “service-connected disability rating by the Department of Veterans Affairs.” Veterans who have basic S-DVI coverage and are completely disabled do not have to pay premiums for this life insurance.
• Supplemental Service-Disabled Veterans’ Insurance (Supplemental S-DVI): Provides an additional $30,000 in life insurance coverage for veterans with basic S-DVI coverage. However, the premiums for this supplemental coverage can’t be waived.

Life insurance options if you are deployed

Ryan Guina, a military veteran and founder of The Military Wallet says that active-duty members of the military need to shop around to find the right life insurance policy for their needs.

“SGLI is a very affordable group life insurance policy, but it is not portable,” he says. “Members are no longer eligible for SGLI when they leave the military.”

He encourages military members to shop for an affordable term life insurance policy while they are still serving in the military.

“They can keep their term life policy when their military service ends, and they will continue to have affordable term life coverage for the duration of their policy,” Guina says. “Veterans who are no longer eligible for either SGLI or VGLI should seek out an affordable term life insurance policy.”

Home insurance for veterans and military personnel

Whether you have a VA loan or a conventional loan, you’re required to have homeowners insurance.Coverage requirements vary by lender.

“Veterans who use a VA loan to buy a home are required to take out hazard insurance coverage to cover the cost of repairing or rebuilding the home in the event it is destroyed,” Guina says.

Hazard coverage should cover damage to your home, including wind and fire damage, theft or vandalism. Other parts of a basic homeowners insurance policy should cover damage to your property, such as a fence, deck or garage. It also should provide liability coverage if someone is injured on your property, in your home or if you damage someone else’s property.

You can add riders to your policy, too. For example, you can add a jewelry rider if you have valuable or sentimental family heirlooms stored in your home.

McChristian says homeowners should also consider flood insurance.

“Flooding is the number one natural disaster in the U.S., and standard home insurance policies do not cover flood damage,” she says.

Home insurance options if you are deployed

If you’re deployed, your home should remain insured while you’re away.

“Unoccupied homes are a hazard,” McChristian says. “If no one is home, that means no one can report a theft, a water leak under the kitchen sink or roof damage from that unexpected hail storm.”

She notes that most insurance policies have a clause that states a home vacant for a certain number of days — typically 30 days, but sometimes longer — may not be covered for a loss.

A homeowner can get an endorsement to their policy for unoccupied homes,” she says.

When you’re shopping for home insurance, ask the insurer whether it has a deployment policy, how long your home can be unoccupied before you lose coverage and the costs of adding an endorsement to your policy to supplement your coverage.

Health insurance for veterans and military personnel

Active-duty military personnel are automatically enrolled in the TriCare Program. Family members also can receive health care coverage through this program.

TriCare offers several different types of health care plans, including TriCare Prime and TriCare Select. TriCare Prime is free for active-duty military personnel and their families. The Select plan includes deductibles and copays. Similar to traditional health insurance, these costs are lower when you go to a doctor who is in TriCare’s network.

TriCare also offers Prime and Select plans for service members who are in remote locations or overseas. Remote plans cover those who are more than 50 miles or a one-hour’s drive from a military hospital or clinic.

TriCare currently offers 11 different health plans for active service members, veterans and their families. You can use the plan comparison tool on TriCare’s website to determine which plan is right for you.

Those seeking veteran’s health insurance also can access VA benefits. VA health care benefits for outpatient, inpatient and preventive services differ from TriCare plans, as do prescription drug benefits and copays.

Private health insurance is also a health care option for veterans. You can use a private health care plan in addition to your VA insurance.

Health insurance options if you are deployed

Whether you have insurance through a federal program or a private insurer, it’s essential to understand the fine print in the health care plan before you sign up. Many insurers offer discounts to service members, while many government programs provide free or low-cost insurance coverage.

Still, you should understand what kind of health care coverage you’re getting for the cost and how this may change when you go from active duty to retirement. Doing a bit of extra research can ensure you and your family have the health care insurance coverage and financial protection you need for the long term.