The life insurance market among active-duty military personnel is large and willing.
The First Command Financial Behaviors Index, commissioned by First Command Financial Services, found that only 48 percent of those military personnel surveyed, pay grades E6 and above, say they do own life insurance.
Of those who are not covered, 46 percent say they are likely to consider purchasing life insurance for themselves or someone in their household.
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Active-duty armed forces personnel are automatically enrolled in Servicemembers' Group Life Insurance, provided by the U.S. Department of Veterans Affairs, and are covered at the maximum $400,000 amount, though they may take action to reduce or decline the coverage. For those who remain covered, a separate Family Servicemembers' Group Life Insurance policy also automatically covers spouses, at a premium, and dependents, at no additional cost.
Besides the uncovered market, First Command Financial Services CEO Scott Spiker said many seek to supplement existing coverage.
"While middle-class military families appreciate the significant value of the life insurance coverage available through the federal government, they understand that extra coverage may be needed to build a risk management program that more thoroughly addresses their financial future," Spiker said by email.
In a separate press release he noted that "so many military families, if they are insurable, opt for supplemental commercial policies in order to increase their overall coverage now and provide longer-term protection for their post-military lives."
"This extra coverage allows them to build a risk management program that more thoroughly addresses the unique risks of military service — risks that can include war-related death,:" At First Command we see that risk firsthand. Since Sept. 11, almost 200 of our clients have died in combat. Out of this group 86 percent had life insurance products in force through First Command totaling more than $18.8 million."
The survey also found that even fewer in the non-military population — just 33 percent — own life insurance, and among the unprotected 42 percent say they likely to make such a purchase.
"These findings indicate a growing interest in permanent life coverage as a time-tested tool for managing long-term financial risk," Spiker said.
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