Employer Group Life and VGLI: How Veterans Coordinate Both

A lot of veterans end up holding two group policies at once. Veterans' Group Life Insurance from the VA, and whatever the new employer provides. Both feel like coverage, so the question becomes which one to keep. This page is about that specific decision. It is not a comparison of group versus individual coverage, which is covered on its own page, and it does not assume either answer.

The thing both have in common

Before comparing them, understand what they share, because it is the most important fact about both.

Neither one belongs to you.

VGLI is a VA program with its own rules and its own pricing schedule. Your employer's coverage belongs to your employer, who can change it, reduce it, or end it, and who will stop providing it the day you stop working there.

That is not an argument against either. Both can be genuinely useful. It is an argument for understanding that coverage you control is a different category, and for not treating either group policy as the foundation of your family's plan. The full case is in group vs individual life insurance.

What VGLI does

VGLI is the VA program you can convert into after separation. Two features matter for this decision.

It reprices in five-year age bands. Your premium rises at every band, for as long as you hold it. The published schedule runs from $0.06 per $1,000 per month under 30 to $4.40 per $1,000 at 80 and over.

You can increase it over time. After one year of coverage you can add $25,000 every five years, up to the $500,000 maximum, until age 60.

VGLI also has no war exclusion, which matters if you still drill or could be mobilized.

The trade-off is the age banding. Managing it is covered in managing VGLI premiums, and the head-to-head against level term is in VGLI vs term life.

What employer group life usually does

Two layers, and they behave differently.

Basic coverage. Usually employer-paid, usually a flat amount or one to two times salary. Free to you, and worth having for exactly that reason.

It is also nowhere near enough, and there is a number that settles the argument. The average group life policy issued in 2022 had a face amount of $56,014. A common rule of thumb puts the need at roughly ten times income, which for a household earning $70,000 means $700,000. The average group policy covers about eight percent of that. It is not a small gap, it is an order of magnitude.

Take the free coverage. Just be clear about what it is, which is a bonus, not a plan.

Supplemental coverage. You pay for this, often through payroll deduction, often in multiples of salary. This is where the real comparison happens, because now you are choosing where to spend your own money.

Group supplemental pricing is often age-banded too, and because it is priced for the whole employee pool rather than for you, a healthy non-smoker can frequently do better on an individual policy while someone with health issues may do better in the group.

The decision, in order

Work through it like this.

1. Keep the free basic coverage. If your employer pays for it, take it. There is no version of this where declining free coverage is correct. Just do not count it as your plan.

2. Do not drop VGLI until something else is in force. This is the most expensive mistake available here. Approved is not in force. Issued, delivered, and paid is in force. Gaps happen in exactly this window.

3. Compare the supplemental layer against an individual policy on price and portability. Get the actual monthly cost for the same face amount both ways. Then ask what happens if you change jobs.

4. Decide on VGLI based on your health and your age. If your health makes private coverage expensive or unavailable, VGLI's value is that it never asked. If you are healthy and relatively young, level term usually costs less over a 20-year horizon because the price does not move. Run the numbers rather than assuming.

5. Put the coverage you own underneath all of it. Sized to your actual need. That is the part that survives a job change, a program change, and a health change.

The 31-day window nobody mentions

When you leave a job, your group life coverage ends. But you usually have a conversion right, and it is time-limited and short.

Under the model act most states follow, when group coverage ends because employment ends, you are entitled to an individual policy from the same insurer without evidence of insurability, provided you apply and pay the first premium within 31 days. There is a detail worth knowing: if you die during that 31-day window before the individual policy takes effect, the amount you could have converted is generally payable as a claim under the group policy anyway.

Two cautions.

Conversion is expensive. The individual policy is typically permanent coverage at your attained age, which usually costs far more per dollar than the group term you are leaving. If you are healthy, applying for a new term policy will almost always beat converting.

Portability is a different thing. Some plans offer portability, which lets you continue term coverage under a group arrangement rather than moving to an individual permanent policy. It is usually cheaper than conversion. But conversion is a right, while portability is a feature your employer's plan may or may not include. Check which you have before you need it.

Exact terms vary by state and by your specific certificate. Ask HR for the certificate, not the summary.

The situation to plan for

The failure mode here is predictable and worth naming.

A veteran separates, takes VGLI, starts a civilian job with decent group coverage, and drops VGLI because the work coverage seems sufficient. Five years later the job ends, the group coverage ends with it, the 31-day conversion window is expensive and gets missed, and now they are five years older with a health record that has grown, applying for individual coverage from scratch.

Nothing went wrong at any single step. The plan just depended on two things nobody controls.

The fix is to own something. A level term policy sized to your actual need, in force underneath whatever group coverage comes and goes. Then group coverage becomes what it should be: a bonus on top, not the foundation.

Frequently asked questions

Do I need life insurance if I have it through work?

Usually yes. Employer coverage is typically one to two times salary, well below what most families need, and it ends when the job does. Treat it as a supplement to coverage you own.

Should I keep VGLI if I have employer life insurance?

It depends on your health and age. VGLI never asked health questions, which is valuable if your health has changed. It also reprices at every five-year age band. If you are healthy, level term often costs less over a long horizon. Never drop VGLI before replacement coverage is actually in force.

What happens to my employer life insurance when I leave the job?

It ends. You generally have a 31-day window to convert to an individual policy without health questions, though that policy is usually permanent coverage at a much higher cost. Some plans also offer portability, which costs less but is not always offered.

Can I have both VGLI and employer coverage?

Yes. There is no restriction on holding both, and many veterans do.

Is supplemental life insurance at work worth it?

Compare the actual monthly cost against an individual policy for the same face amount. Healthy applicants often do better individually. Applicants with health issues often do better in the group, because the group did not underwrite them individually.

Your next step

Take the quiz, Which Coverage Fits You? It sorts out what you should own versus what you can leave to a group plan. Or get the free guide, "Leaving the Service: Your Life Insurance Decision Guide".

This material is intended only for general educational purposes and is not a solicitation of a life insurance policy.

Sources: VA, Veterans' Group Life Insurance (va.gov/life-insurance/options-eligibility/vgli/), rate table effective July 1, 2025; NAIC, Group Life Insurance Definition and Standard Provisions Model Act, Model 565 (content.naic.org); American Council of Life Insurers, 2023 Life Insurers Fact Book (acli.com), average group life policy face amount issued 2022. Accessed August 15, 2026.