Servicemembers Favor Permanent, Not Temporary Life Insurance

On the contrary, civilian families are more likely to utilize temporary coverage. The survey found such coverage “dropped to a new low for military families and reached a record high in the general population.” Just a third of military families own term life insurance, down 19 points, while coverage increased six points for civilian families to 48%.

First Command — which sells insurance and provides investing, banking and financial planning services — noted in a statement that military families use permanent insurance products as supplemental coverage to government benefits. Active-duty personnel are eligible for up to $400,000 in Servicemembers’ Group Life Insurance and may add optional spousal coverage of up to $100,000 and dependent coverage of up to $10,000.

Veterans can convert their SGLI benefits to Veterans’ Group Life Insurance but may face higher premiums.

“Adding permanent life insurance to government-provided coverage allows servicemembers and their families to more fully and effectively address their present and future needs,” Scott Spiker, CEO of First Command Financial Services, said in the statement. “This add-on strategy allows families to focus on the current uncertainties of military life — uncertainties that can include the risk of a combat death — as well as pursue long-term financial security.”

— Check out Advisors Who Serve(d) Tell Their Stories: Fourth of July, 2015 on ThinkAdvisor.