New Insurance Benefits for Veterans: Fairness for Servicemembers Act

A New VA Life Insurance Law Aims to Keep SGLI and VGLI Coverage From Falling Behind Inflation

Life insurance inside the military and veteran ecosystem tends to move in big steps, not small ones. Coverage caps get updated, premiums adjust, and carriers and administrators absorb the operational ripple effects. But what often gets overlooked is the quiet erosion that happens in between those big moments: inflation.

That is the gap Congress just tried to close with the Fairness for Servicemembers and Their Families Act, now enacted and focused on keeping Servicemembers’ Group Life Insurance (SGLI) and Veterans’ Group Life Insurance (VGLI) coverage aligned with real world costs over time. (Marilyn Strickland)

At its core, the law directs the VA Secretary to review and report every five years on how the maximum coverage compares with changes in inflation and cost of living, using the Consumer Price Index for All Urban Consumers (CPI-U) as the benchmark. (GovInfo)

Why This Matters to Insurance Professionals

For an industry audience, the most important takeaway is not that the cap might change tomorrow. It is that the review cadence is now baked into statute.

That shifts the conversation from “Should we update the cap?” to “When the next review arrives, what will the data show?” It also gives benefit advocates, program administrators, and adjacent carriers a more predictable policy rhythm, which matters for planning communications, enrollment servicing, and downstream product positioning.

“Our bill would help ensure the Veterans Affairs Department can offer competitive life insurance packages that keep pace with the current cost of living.”
Sen. John Cornyn (R-Texas) (MOAA)

The House sponsor framed it as a commitment to military families and their financial safety net.

“I’m grateful to President Trump for his unwavering support of our brave men and women in uniform and for signing this bill into law, which will help ensure the Veterans Affairs Department can offer competitive life insurance packages that keep pace with the current cost of living.”
Rep. Marilyn Strickland (D-Wash.) (Marilyn Strickland)

The $500,000 Cap Is Recent, But Inflation Pressure Is Not

The maximum coverage under SGLI rose to $500,000 effective March 1, 2023, with coverage generally offered in $50,000 increments and premiums reflecting the elected amount. (Benefits)

In practical terms, that 2023 increase was a meaningful reset. Yet even after a jump like that, inflation can quickly chip away at purchasing power. The new law does not mandate automatic increases. Instead, it requires the VA to repeatedly put the numbers in front of Congress so future decisions are grounded in a transparent, periodic assessment. (GovInfo)

At a Glance: What the Act Changes

The Insurance Angle: Predictability, Communication, and Product Context

For carriers and distribution partners operating near the military market, this is less about competing with SGLI or VGLI and more about understanding how these programs set consumer expectations.

When the government’s baseline benefit stays current, it can influence:

• how servicemembers perceive “adequate” coverage,

• how often they revisit beneficiary designations and coverage elections,

• and how private-market offerings position supplemental life coverage around the group program.

The five-year reporting requirement also creates natural moments for education campaigns. Think of it as a recurring trigger for conversations about protection gaps, beneficiary updates, and the difference between basic group coverage and longer-term needs.

MOAA has emphasized that preserving the value of earned benefits remains a legislative priority.
Jen Goodale, Military Officers Association of America (MOAA) (int.moaa.org)

One Practical Checklist for Industry Teams

• Watch for the VA’s five-year reports and be ready to translate findings into plain-language guidance for servicemembers and veteran clients. (CBO)

• Prepare for renewed attention on SGLI and VGLI limits during the reporting cycle, even if caps do not change immediately. (CBO)

• Align outreach with familiar milestones, since SGLI coverage elections and life events remain key moments to discuss total coverage needs. (Benefits)

The Bottom Line

The Fairness for Servicemembers and Their Families Act is a policy lever designed to reduce “set it and forget it” drift in military and veteran life insurance. It does that by making inflation review a recurring obligation, not an occasional debate.

For the insurance industry, the opportunity is to treat those recurring checkpoints as a predictable rhythm for consumer education and for thoughtful, respectful coverage conversations that complement the VA’s foundational programs.