New VA Life Insurance Program (VALife)

[Jason Perry]

Here's an article about the VALife program.

"New life insurance program for disabled vets sees high demand​

By Leo Shane III

More than 31,000 disabled veterans received life insurance coverage through a new targeted federal program last year, a total that Veterans Affairs officials said underscores the interest in the offerings and the need for wider outreach on its availability.

The VALife program — open to veterans aged 80 and under with no disqualifications for medical reasons — was launched in January 2023 to expand available life insurance options for disabled veterans. It was the first new life insurance offering by the department in more than 50 years...More "

 

[RangerVic]

So, in essence you are paying about $2k a year betting you will die within 20 years of starting. Otherwise you give them $2k a year for over 20 years and your family only gets $40k back. There are better ways to invest that money to get $40k, I would think. That's if you are in your 50s. If you are in your 60 its even more per year.

 

[Jason Perry]

So, in essence you are paying about $2k a year betting you will die within 20 years of starting. Otherwise you give them $2k a year for over 20 years and your family only gets $40k back. There are better ways to invest that money to get $40k, I would think. That's if you are in your 50s. If you are in your 60 its even more per year.

I don't know the details about the premiums, so I am not sure where you are getting the $2k amount from.....did you look into this program? Is it roughly $2k per year for $40k in coverage? If that's the case, I would think that you may well be right that there are better ways to get a higher return on the "investment." With one caveat- the article and press release suggest that there are no denials or questions about your disability. So, if you are gravely ill, and are not anticipating living for 20 years, then this might be the reason or situation where this program makes sense.

Interested in hearing from anyone who has enrolled in this program.

 

[JMATTK]

It depends on the age you lock it in at. I locked in at 38 for $81.20 a month. It’s not a great investment, but I try to grab life insurance where I can that doesn’t require an exam. The policy also starts to build a cash value after two years.

Veterans Affairs Life Insurance (VALife) | Veterans Affairs

Veterans Affairs Life Insurance (VALife) provides low-cost coverage to Veterans with service-connected disabilities. Find out if you’re eligible and how to apply.

www.va.gov

 

[Jason Perry]

So, in essence you are paying about $2k a year betting you will die within 20 years of starting. Otherwise you give them $2k a year for over 20 years and your family only gets $40k back. There are better ways to invest that money to get $40k, I would think. That's if you are in your 50s. If you are in your 60 its even more per year.

I locked in at 38 for $81.20 a month.

Huge variation in the figures here.

 

[RangerVic]

I don't know the details about the premiums, so I am not sure where you are getting the $2k amount from.....did you look into this program? Is it roughly $2k per year for $40k in coverage? If that's the case, I would think that you may well be right that there are better ways to get a higher return on the "investment." With one caveat- the article and press release suggest that there are no denials or questions about your disability. So, if you are gravely ill, and are not anticipating living for 20 years, then this might be the reason or situation where this program makes sense.

Interested in hearing from anyone who has enrolled in this program.

Good point, but it will not pay out unless you have been paying premiums for two years. So if you think you can hold out for two years it may be worth it. If you don't make it to years then you get the money back. I guess it's worth a shot. The problem I see is that if you start early, like at age 38 and like expectancy is 20 years you will pay more than 40K in your lifetime so your only saving grace is hoping to die at a young age. Myself, i'm uninsurable. I don't think 40K will go a long way anyways. Better off paying for SBP.
At age 56 premium is 160.40/month ($1924.80/yr). At age 60 it is $200/month or $2400/yr. It goes up from there every year. So, at 16.5 years you would have put in $40K. If you live past that you are putting in for absolutely no return and if you stop you lost $40K.

 

[Jason Perry]

Good point, but it will not pay out unless you have been paying premiums for two years. So if you think you can hold out for two years it may be worth it. If you don't make it to years then you get the money back. I guess it's worth a shot. The problem I see is that if you start early, like at age 38 and like expectancy is 20 years you will pay more than 40K in your lifetime so your only saving grace is hoping to die at a young age. Myself, i'm uninsurable. I don't think 40K will go a long way anyways. Better off paying for SBP.
At age 56 premium is 160.40/month ($1924.80/yr). At age 60 it is $200/month or $2400/yr. It goes up from there every year. So, at 16.5 years you would have put in $40K. If you live past that you are putting in for absolutely no return and if you stop you lost $40K.

Yeah, I am guessing that, like most things in life, everything is fact-dependent. I see these commercials for Colonial Pen Life that are for $9 bucks a month and I don't believe at all that its a good deal for most folks. (Same with Tom Selleck or Joe Namath hawking various "financial products"/reverse mortgages, etc. Don't get me started on the car repair insurance programs. And, every time I buy a TV or something from Best Buy or Amazon, there is no way in hell I am paying for the "protection plan."

Still, with the VA having this program, I am thinking it is not a straight up rip off and may be good for some folks.

There's a ton of variation in the sophistication and circumstances of folks looking into these life insurance and "estate planning" ideas. Many factors make it hard to say whether something is "good" or "bad" or somewhere in between.