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National Guard Insurance – National Guard Technician


The National Guard grew out of the various state militia which has been a significant part of our defense history since the early 1700s. National Guard technicians of the Army and Air National Guard represents an essential part of the federal workforce. Technicians have become members of a relatively new group of federal employees who are covered by the National Guard Technician’s Act of 1968 (Public Law 90-486). Here we'll discuss National Guard Insurance for National Guard technicians.

The National Guard workforce is comprised of military technicians, competitive technicians and Active Guard Reserve (AGRs). Military technicians are required to maintain military membership in the National Guard in order to retain employment. Military technicians perform full-time work in their units, perform military training and duty in their units and are available to enter active military service at any time their unit is called to active duty. Competitive technicians are civil service and are not required to maintain military membership in the National Guard.

In the context of full-time work, technicians are considered to be employees of the Department of Army or Department of Air Force. However, unlike other federal employees, the State Adjutant General is the office with the authority to affect employment and is the level of final appeal for most personnel actions. Technicians enjoy the same benefits, rights, and privileges as other federal employees, with a few exceptions provided for in law.
As a federal employee, you provide the day-to-day continuity in the operation and training of Army and Air National Guard unit members.


Military Technicians and Life Insurance


Since military technicians are both members of the military and federal employees, there is access to term life insurance benefits through the military in the form of the Serviceman’s Group Life Insurance (SGLI) Program and through the Federal Government as a federal employee using the Federal Group Life Insurance (FEGLI) Program. Also each state Military Department, through their National Guard Association offers some type of term life insurance through a program for National Guard Insurance for National Guard technicians.


Term life insurance coverage


National Guard Technicians should carry only the FEGLI basic coverage and utilize SGLI term life insurance. FEGLI basic will provide a death benefit of 1 times your salary plus $2,000 and the cost remains low through the age of 65. At retirement, the National Guard Technician can select the 75% reduction and at the age of 65 the basic coverage no longer requires payment and it reduces by 2% a year down to 75% of the amount from last employed date. If the military technician is carrying optional B coverage, this gets prohibitively expensive at the age of 50 (as we discussed previously here) and there are less expensive policies in the commercial space that one can own and carry into retirement. This normally provides the military technician over $600,000 in term coverage for less than $50.00 monthly while in service.


Permanent life insurance coverage


Prior to turning age 50, the National Guard technician should obtain some type of private permanent coverage. In fact, the younger the National Guard technician obtains permanent coverage, the less the monthly premium will be for their National Guard insurance.  And to take this a step further – permanent coverage should really be considered while the National Guard Technician is in the 30s and 40s. Permanent coverage needs to be in place after the SGLI has expired and when the FEGLI has reduced down to 25% of your salary when you retired. Use the online quote engine here to get an idea of how much a permanent policy will cost at your current age. There are several permanent coverage options. There is whole life, universal life and even a term policy to the age of 100.

Permanent coverage is where it can get pretty complicated for the National Guard Technician. Because it’s here one might consider using permanent life insurance instead of the military survivor benefit program (SBP) or the federal employee survivor benefit program and maximize retired pay. This is a topic for a later article and we will update the link once we write it.

There is not much written on this topic and most Nation Guard Technicians just simply select the middle of the road option B on both the military and FERS so the surviving spouse can receive a reduced benefit. While this is a good conservative approach, there might be a way to decisively take more retirement earnings and get more coverage for your family for the price that might have bigger tax advantages later on in retirement.

The SBP programs are probably pretty expensive and there is probably a more inexpensive path using privately owned life insurance to provide the National Guard Technician a way to maximize both their FERS retirement pay and their military retired pay and provide (tax-free) income replacement to a surviving spouse.

When the National Guard Technician receives their 20-year letter (20 years of service in the National Guard) they are required to return this document with their survivor benefit plan designation. At this point, the National Guard Technician needs all of this insight to decide how all of the survivor benefits will be arrayed to support the surviving family and deciding how it will affect pay during retirement.


National Guard Insurance - Universal Life Insurance


Veteran Universal Life Insurance is insurance that works for veterans to aid them in their post-military endeavors. Universal life insurance means that you can vary or even suspend your premium payments depending on the financial pressures you face. Unlike typical life insurance, which pays out only on the demise of the policyholder, or at a nominated age, veteran universal life insurance is an investment scheme as well as life insurance.

This means that you build up a balance which you can borrow against or from to finance various purchases. The flexibility that is built in with payments is unparalleled in the insurance world, and can really help you and your family financially. If the policy is performing well, your beneficiaries may even receive more than the nominated death benefit. You can also borrow on the balance of the insurance, for things like post-retirement income. These withdrawals are deducted from the death benefit which is paid out to the beneficiaries. All these benefits do come at a cost however, a cost that you bear in the form of higher premiums than normal life insurance.

Where the advantage comes in is that you can effectively combine life insurance and tax efficient growth, not only that, but the policy can be tailored to suit the needs of a growing family. You can choose which investments your policy goes towards. This means that you can choose the amount of risk you take on, all whilst reaping the rewards that come with investments. Veteran universal life insurance can be an excellent means of safeguarding your family financially and a tax-efficient way to access cash in the retirement years.

 Use the online quote engine to find a whole life policy that will be there after SGLI is gone and FEGLI has completed 75% reduction. 


National Guard Insurance - Whole Life Insurance


Whole life policies can vary a great deal when it comes to the way they are paid out. In some policies, the payout can be a fixed sum of money that has been decided on at the time the policy is started. In other cases, the payout may be dependent on investment performance after mortality costs and other expenses are deducted. Within the arena of whole life policies, the timing and the amount of the premiums may vary as well. In some policies the premiums are paid at regular intervals such as monthly or every six months and the premium amount is fixed. In other cases, the premium amount will vary according to how the insurance investment is performing.

Whole life can also have a lot of flexibility in how it is bought and used. For example, some policies allow for the payout over a specified period of time, such as ten years. Once this period is over, the policyholder can continue the insurance coverage but usually at a higher premium rate.
These types of life insurance policies are useful for people who need increased coverage while they have dependent children but will need reduced coverage later on in life that is all but guaranteed. This is not always the case with term life insurance where illness can prevent the person from getting the policy.

It should be understood that whole life insurance often requires that the policyholder pay premiums for the life of the policy. Another scenario for whole life is for the policyholder to pay u front the cost of the entire policy, or that the cost of the policy be paid within a certain amount of time, such as five years. This can be expensive, and many consumers simply cannot afford the cost when it is presented in this fashion.
There are certain benefits associated with a whole life policy. Many companies will guarantee that the policy's cash values will increase regardless of the performance of the company. This can make a whole life policy an attractive investment for some people.
In addition, there is liquidity with these policies that other types of insurance may not be able to match. Cash values are often thought to be liquid enough to be used for investment capital, but the policyholder must be financially healthy enough to continue making the higher premium payments.

There can be some tax advantages as well, as cash value access is tax-free up to the total premiums paid. The remainder of the value can be tax-free if taken in the form of loans from the policy. If the policy lapses, tax payment will be due on the outstanding loans. If the insured dies, the death benefit is reduced by the amount of any outstanding loan balance.
Use the online quote engine to find a whole life policy that will be there after SGLI is gone and FEGLI has completed 75% reduction.


Term Life to Age 100 using the Family Protection Plan by 5 Star Life


We wrote more on this product here. We have access to a great product from 5Star Life called the Family Protection Plan. It’s term life coverage to age 100. This is a great product for a National Guard technician to secure permanent coverage at a low cost after SGLI has expired and when FEGLI has completed the 75% reduction. You can enroll over the phone. Call 540 300-5026 to see how much it would cost to enroll for your age. There is no exam required to enroll in this plan, just 7 medical questions. The application is signed using voice signatures. Find out how you can qualify for these rates.


Terry Biddle is a business owner, blogger, retired Army National Guard officer and a current federal employee. He works with seniors, federal employees, and members of the military to get the most life insurance benefits at the greatest value across the full spectrum of term and permanent products from fully underwritten to no-exam and guaranteed issue. Please feel free to contact me here.