What Is The Survivor Benefit Plan?
One of the advantages to a military life is that certain benefits are generally available to personnel that might not be available to all civilians. One of these is the Survivor Benefit Plan (SBP), which is an insurance plan for spouses and children of military personnel that will pay out a monthly annuity in the event of the servicemember’s passing. While the SBP can provide a measure of comfort to some in knowing that their families are provided for in the event of the unthinkable, what many do not know is that divorce will often change their SBP status. It can be very important to understand how.
Starts Post Retirement
Upon your or your spouse’s retirement from the military, they will be asked to choose a beneficiary if they choose to sign up for the program. The majority of servicemembers choose their spouse, but it is possible to choose someone else, including minor children, or other non-relatives that have a “natural interest” in the person, such as a caretaker, parent, or business partner. Whomever you choose, that person will then receive a monthly sum that will roughly equal 55 percent of the servicemember’s chosen coverage amount.
The SBP is a very significant benefit for many families, especially those with less income, because the payments will last even upon the death of the servicemember. It is also important to note that unlike many private insurance plans, your health worsening will not result in cancellation or a rise in payment costs. However, premiums are taken out beginning at retirement (SBP is provided at no cost while the servicemember is in active service, but afterward as much as 6.5 percent of the member’s retirement pay is taken out as a premium).
Division In Divorce
Divorce’s impact on SBP coverage will depend on what manner of coverage you choose upon retirement. If you had chosen to cover your spouse upon the creation of your SBP, the coverage will stop unless you elect voluntarily to continue it – unless your divorce decree contains language that requires you to adopt what is referred to as Former Spouse coverage. Obviously, if you are required to change your coverage to Former Spouse, you must comply with the court’s order, but if your divorce decree does not touch on the issue, the choice is yours.
If you chose Spouse & Child coverage when you enrolled in SBP, by comparison, the coverage will revert, in most situations, to any eligible child or children (usually minors or those of college age) upon divorce. If there are no children remaining who are eligible, the coverage will lapse and premiums will be refunded if you do not voluntarily choose to cover your former spouse, since the beneficiary of an SBP cannot simply be changed at random.
Call An Experienced Attorney
Divorce is never easy, and military divorce can be even more complex. If you have questions, contacting a knowledgeable attorney is the way to go. The Law Offices of Steven A. Mason, P.A. boasts a retired Army judge advocate who has experience in these cases; we are happy to try and assist you. Contact the Fort Lauderdale and Hollywood Law Offices of Steven A. Mason, P.A. for legal advice at 954-963-5900 or leave a message online.