Comparing Veterans’ Group
Life Insurance (VGLI) to Whole
Life Insurance Coverage
Life insurance can be confusing. One of the most common questions we get from Servicemembers and Veterans is,
what type of life insurance is Veterans’ Group Life Insurance (VGLI)?
The easy answer to that question is, Veterans’ Group
Life Insurance coverage is term life insurance, which
is very different from, and often is confused with,
another common type of coverage called whole life
insurance. We want to make sure you understand the
differences between term and whole life coverage
so you can make an informed decision about which
coverage is best for you.
To help explain the differences, we put together the
facts and features about both below. This information
is not intended to persuade or promote one type of
coverage over the other – it is just a list of features:
Features of term life insurance
• Provides death benets only, there is no cash value
that builds over time
• Only pays a death benet if the coverage is in force
when the insured dies and premiums must always
be paid to keep the coverage in force
• A health exam may be required to obtain coverage,
but can generally be renewed without proof of
good health
• Usually the most affordable life insurance to buy
• Purchased for a specic time period, during which
time the premiums remain level. After this level
premium period, the premiums increase until
a certain age is reached at which time the
coverage ends.
• Becomes more expensive as you age, especially
after age 50
• Death benet is intended to replace income
• Often includes a provision which allows the term
policy to be converted to a permanent policy
without medical underwriting.
Features of whole life insurance:
• Provides death benets as well as a cash
value accumulation that builds during the life of
the policy
• Whole life insurance premiums are generally higher
at younger ages than term life insurance premiums,
but they but remain level for the life of the policy
• A health exam may be required to obtain coverage
• Sometimes can be purchased without a medical
exam, but possibly at a higher cost
• Cash value is based on how long the policy has
been in force
• A portion of the cash value can usually be
withdrawn or borrowed against during the life of
the policy