The SGLI policy may be the largest asset for many servicemembers’ family members. Careful estate planning and management of SGLI coverage is essential to financial security. An important part of taking out a SGLI policy is electing the amount of SGLI coverage and designating SGLI beneficiaries on the SGLV form 8286.
The SGLV form 8286 is Servicemembers’ Group Life Insurance Election and Certificate which a servicemember must complete in order to name beneficiaries and elect the amount of SGLI coverage. This form can be completed online or printed and turned into the S-1 office.
When servicemembers designate beneficiaries by completing the SGLV form 8286, they need to make sure such beneficiary designations are accepted by their unit.
To be effective all SGLI coverage amount and beneficiary changes must be accepted by the unit before the servicemember’s death. But what happens if a change was made but not accepted by the unit by the time of the insured’s death? In such cases, the insurance company can pay to the existing beneficiary or it can wait until the beneficiary dispute is resolved.
In some cases, the insurance company will file an interpleader and place the SGLI benefits with the court until the dispute in resolved. SGLI beneficiary disputes are very complex and require the help of an SGLI lawyer.
An SGLI claim may also be delayed if there are problems with the beneficiary on record: several SGLI claims may be filed for the same SGLI benefits; beneficiary change considered not completed; beneficiary change deemed not effective; several beneficiaries are named to receive 100 per cent of benefits; adding all beneficiary percentages equals to more than 100 per cent, or primary beneficiaries are not available.
Primary beneficiaries are those who will collect SGLI benefits after the servicemember’s death. Secondary beneficiaries are those who receive SGLI payment if primary beneficiaries are not available (usually deceased).
Finally, if primary and contingent beneficiaries are not available or if no beneficiaries are elected on the SGLV form 8286, SGLI proceeds will pay out to the following beneficiaries in the order listed: a) spouse; b) children; c) parents; d) executor of the estate, or e) next of kin.
An SGLI claim may also be delayed if a beneficiary is a minor child. Even though it is not advisable to name a minor as a direct beneficiary to a SGLI life insurance policy, many soldiers often desire to leave proceeds to their minor children.
They may do so by funding a testamentary trust with SGLI proceeds, in which cases payments can be made only through the probate process, which can result in claim delays.
If a minor child is a direct beneficiary, SGLI will pay to the child’s court-appointed guardian of the child’s property or conservator of the child’s estate, as required by the law of the state in which the child resides. This can also take time and result in delayed payments.
Expediting a delayed SGLI claim is not a do-it-yourself project. It requires the skill and knowledge of an experienced SGLI attorney. At our firm, we work hard at achieving the best possible results for our clients.
We help SGLI beneficiaries and servicemembers’ families receive SGLI benefits to which they are entitled under the law.
Call (888) 510-2212 for a free consultation.