1. U.S. Code
  2. title 38
  3. part II
  4. chapter 19
  5. subchapter I
  6. § 1904

Collapse to view only § 1904. Plans of insurance

§ 1901. Definitions
For the purposes of this subchapter—
(1) The term “insurance” means National Service Life Insurance.
(2) The terms “widow” or “widower” mean a person who was the lawful spouse of the insured at the maturity of the insurance.
(3) The term “child” means a legitimate child, an adopted child, and, if designated as beneficiary by the insured, a stepchild or an illegitimate child.
(4) The terms “parent”, “father”, and “mother” mean a father, mother, father through adoption, mother through adoption, persons who have stood in loco parentis to a member of the military or naval forces at any time before entry into active service for a period of not less than one year, and a step­parent, if designated as beneficiary by the insured.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1148, § 701; renumbered § 1901, Pub. L. 102–83, § 5(a), Aug. 6, 1991, 105 Stat. 406.)

CITE AS: 38 USC 1901

§ 1902. Premium rates and policy values

Premium rates for insurance shall be the net rates based upon the American Experience Table of Mortality and interest at the rate of 3 per centum per annum. All cash, loan, paid-up, and extended values, and all other calculations in connection with insurance, shall be based upon said American Experience Table of Mortality and interest at the rate of 3 per centum per annum.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1148, § 702; renumbered § 1902, Pub. L. 102–83, § 5(a), Aug. 6, 1991, 105 Stat. 406.)

CITE AS: 38 USC 1902

§ 1903. Amount of insurance

Insurance shall be issued in any multiple of $500 and the amount of insurance with respect to any one person shall be not less than $1,000 or more than $10,000. No person may carry a combined amount of National Service Life Insurance and United States Government life insurance in excess of $10,000 at any one time. The limitations of this section shall not apply to the additional paid up insurance the purchase of which is authorized under section 1907 of this title.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1148, § 703; Pub. L. 92–188, § 1, Dec. 15, 1971, 85 Stat. 645; renumbered § 1903 and amended Pub. L. 102–83, § 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 406.)

CITE AS: 38 USC 1903

§ 1904. Plans of insurance
(a) Insurance may be issued on the following plans: Five-year level premium term, ordinary life, twenty-payment life, thirty-payment life, twenty-year endowment, endowment at age sixty, and endowment at age sixty-five. Level premium term insurance may be converted as of the date when any premium becomes or has become due, or exchanged as of the date of the original policy, upon payment of the difference in reserve, at any time while such insurance is in force and within the term period to any of the foregoing permanent plans of insurance, except that conversion to an endowment plan may not be made while the insured is totally disabled.
(b) Under such regulations as the Secretary may promulgate a policy of participating insurance may be converted to or exchanged for insurance issued under this subsection on a modified life plan. Insurance issued under this subsection shall be on the same terms and conditions as the insurance which it replaces, except (1) the premium rates for such insurance shall be based on the 1958 Commissioners Standard Ordinary Basic Table of Mortality and interest at the rate of 3 per centum per annum; (2) all cash, loan, paid-up, and extended values shall be based on the 1958 Commissioners Standard Ordinary Basic Table of Mortality and interest at the rate of 3 per centum per annum; and (3) at the end of the day preceding the sixty-fifth birthday of the insured the face value of the modified life insurance policy or the amount of extended term insurance thereunder shall be automatically reduced by one-half thereof, without any reduction in premium.
(c) Under such regulations as the Secretary may promulgate, a policy of nonparticipating insurance may be converted to or exchanged for insurance issued under this subsection on a modified life plan. Insurance issued under this subsection shall be on the same terms and conditions as the insurance which it replaces, except that (1) term insurance issued under section 621 of the National Service Life Insurance Act of 1940 shall be deemed for the purposes of this subsection to have been issued under section 1923(b) of this title; and (2) at the end of the day preceding the sixty-fifth birthday of the insured the face value of the modified life insurance policy or the amount of extended term insurance thereunder shall be automatically reduced by one-half thereof, without any reduction in premium. Any person eligible for insurance under section 1922(a), or section 1925 of this title may be granted a modified life insurance policy under this subsection which, subject to exception (2) above, shall be issued on the same terms and conditions specified in section 1922(a) or section 1925, whichever is applicable.
(d) Any insured whose modified life insurance policy is in force by payment or waiver of premiums on the day before the insured’s sixty-fifth birthday may upon written application and payment of premiums made before such birthday be granted National Service Life Insurance, on an ordinary life plan, without physical examination, in an amount of not less than $500, in multiples of $250, but not in excess of one-half of the face amount of the modified life insurance policy in force on the day before the insured’s sixty-fifth birthday. Insurance issued under this subsection shall be effective on the sixty-fifth birthday of the insured. The premium rate, cash, loan, paid-up, and extended values on the ordinary life insurance issued under this subsection shall be based on the same mortality tables and interest rates as the insurance issued under the modified life policy. Settlements on policies involving annuities on insurance issued under this subsection shall be based on the same mortality or annuity tables and interest rates as such settlements on the modified life policy. If the insured is totally disabled on the day before the insured’s sixty-fifth birthday and premiums on the insured’s modified life insurance policy are being waived under section 1912 of this title or the insured is entitled on that date to waiver under such section the insured shall be automatically granted the maximum amount of insurance authorized under this subsection and premiums on such insurance shall be waived during the continuous total disability of the insured.
(e) After June 30, 1972, and under such regulations as the Secretary may promulgate, insurance may be converted to or exchanged for insurance on a modified life plan under the same terms and conditions as are set forth in subsections (b) and (c) of this section except that at the end of the day preceding the seventieth birthday of the insured the face value of the modified life insurance policy or the amount of extended insurance thereunder shall be automatically reduced by one-half thereof, without any reduction in premium. Any insured whose modified life insurance policy issued under this subsection is in force by payment or waiver of premiums on the day before the insured’s seventieth birthday may be granted insurance on the ordinary life plan upon the same terms and conditions as are set forth in subsection (d) of this section except that in applying such provisions the seventieth birthday is to be substituted for the sixty-fifth birthday. Notwithstanding any other provision of law or regulations the Secretary under such terms and conditions as the Secretary determines to be reasonable and practicable and upon written application and payment of the required premiums, reserves, or other necessary amounts made within one year from the effective date of this subsection by an insured having in force a modified life plan issued under subsection (b) or (c) of this section, including any replacement insurance issued under subsection (d) of this section or other provision of this title, can exchange such insurance without proof of good health for an amount of insurance issued under this subsection equal to the insurance then in force or which was in force on the day before such insured’s sixty-fifth birthday, whichever is the greater.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1148, § 704; Pub. L. 88–664, § 12(b), Oct. 13, 1964, 78 Stat. 1098; Pub. L. 92–193, Dec. 15, 1971, 85 Stat. 648; Pub. L. 97–295, § 4(21), Oct. 12, 1982, 96 Stat. 1306; Pub. L. 99–576, title VII, § 701(21), Oct. 28, 1986, 100 Stat. 3292; renumbered § 1904 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1904

§ 1905. Renewal

All level premium term policies, except as otherwise provided in this section, shall cease and terminate at the expiration of the term period. At the expiration of any term period any five-year level premium term policy which has not been exchanged or converted to a permanent plan of insurance and which is not lapsed shall be renewed as level premium term insurance without application for a successive five-year period at the premium rate for the attained age without medical examination. However, renewal will be effected in cases where the policy is lapsed only if the insured makes application for reinstatement and renewal of the term policy within five years after the date of lapse, and reinstatement in such cases shall be under the terms and conditions prescribed by the Secretary. In any case in which the insured is shown by evidence satisfactory to the Secretary to be totally disabled at the expiration of the level premium term period of the insurance under conditions which would entitle the insured to continued insurance protection but for such expiration, the insurance, if subject to renewal under this section, shall be automatically renewed for an additional period of five years at the premium rate for the then attained age, unless the insured has elected insurance on some other available plan.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1148, § 705; Pub. L. 91–291, § 8, June 25, 1970, 84 Stat. 331; Pub. L. 99–576, title VII, § 701(22), Oct. 28, 1986, 100 Stat. 3292; renumbered § 1905 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1905

§ 1906. Policy provisions

Provisions for cash, loan, paid-up, and extended values, dividends from gains and savings, refund of unearned premiums, and such other provisions as may be found to be reasonable and practicable may be provided for in the policy of insurance from time to time by regulations promulgated by the Secretary.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1149, § 706; renumbered § 1906 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1906

§ 1907. Payment or use of dividends
(a) Until and unless the Secretary has received from the insured a request or directive in writing exercising any other dividend option allowable under the insured’s policy, any dividend accumulations and unpaid dividends shall be applied in payment of premiums becoming due on insurance subsequent to the date the dividend is payable after January 1, 1952.
(b) No claim by an insured for payment in cash of a special dividend declared prior to January 1, 1952, shall be processed by the Secretary unless such claim was received within six years after such dividend was declared. Whenever any claim for payment of a special dividend, the processing of which is barred by this subsection, is received by the Secretary, it shall be returned to the claimant, with a copy of this subsection, and such action shall be a complete response without further communication.
(c) The Secretary, upon application in writing made by the insured for insurance under this subsection, and without proof of good health, is authorized to apply any dividend due and payable on national service life insurance after the date of such application to purchase paid up insurance. Also, the Secretary, upon application in writing made by the insured during the one-year period beginning September 1, 1991, and without proof of good health, is authorized to apply any national service life insurance dividend credits and deposits of such insured existing at the date of the insured’s application to purchase paid up insurance. After September 1, 1992, the Secretary may, from time to time, provide for further one-year periods during which insureds may purchase additional paid up insurance from existing dividend credits and deposits. Any such period for the purchase of additional paid up insurance may be allowed only if the Secretary determines in the case of any such period that it would be actuarially and administratively sound to do so. Any dividends, dividend credits, or deposits on endowment policies may be used under this subsection only to purchase additional paid up endowment insurance which matures concurrently with the basic policy. Any dividends, dividend credits, or deposits on policies (other than endowment policies) may be used under this section only to purchase additional paid up whole life insurance. The paid up insurance granted under this subsection shall be in addition to any insurance otherwise authorized under this title, or under prior provisions of law. The paid up insurance granted under this subsection shall be issued on the same terms and conditions as are contained in the standard policies of national service life insurance except (1) the premium rates for such insurance and all cash and loan values thereon shall be based on such table of mortality and rate of interest per annum as may be prescribed by the Secretary; (2) the total disability income provision authorized under section 1915 of this title may not be added to insurance issued under this section; and (3) the insurance shall include such other changes in terms and conditions as the Secretary determines to be reasonable and practicable.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1149, § 707; Pub. L. 91–291, § 9, June 25, 1970, 84 Stat. 331; Pub. L. 92–188, § 2, Dec. 15, 1971, 85 Stat. 645; Pub. L. 97–295, § 4(22), Oct. 12, 1982, 96 Stat. 1306; Pub. L. 99–576, title VII, § 701(23), Oct. 28, 1986, 100 Stat. 3292; renumbered § 1907 and amended Pub. L. 102–83, §§ 4(a)(2)(A)(iii)(I), (C)(i), (b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 403–406; Pub. L. 102–86, title II, § 203, Aug. 14, 1991, 105 Stat. 416.)

CITE AS: 38 USC 1907

§ 1908. Premium payments

The Secretary shall, by regulations, prescribe the time and method of payment of the premiums on insurance, but payments of premiums in advance shall not be required for periods of more than one month each, and may at the election of the insured be deducted from the insured’s active-service pay or be otherwise made. An amount equal to the first premium due under a National Service Life Insurance policy may be advanced from current appropriations for active-service pay to any person in the active service in the Army, Navy, Air Force, Marine Corps, Space Force, or Coast Guard, which amount shall constitute a lien upon any service or other pay accruing to the person for whom such advance was made and shall be collected therefrom if not otherwise paid. No disbursing or certifying officer shall be responsible for any loss incurred by reason of such advance. Any amount so advanced in excess of available service or other pay shall constitute a lien on the policy within the provisions of section 5301(b) of this title.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1149, § 708; Pub. L. 99–576, title VII, § 701(24), Oct. 28, 1986, 100 Stat. 3292; Pub. L. 102–40, title IV, § 402(d)(1), May 7, 1991, 105 Stat. 239; renumbered § 1908 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406; Pub. L. 116–283, div. A, title IX, § 926(e), Jan. 1, 2021, 134 Stat. 3831.)

CITE AS: 38 USC 1908

§ 1909. Effective date of insurance

Insurance may be made effective, as specified in the application, not later than the first day of the calendar month following the date of application therefor, but the United States shall not be liable thereunder for death occurring before such effective date.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1149, § 709; renumbered § 1909, Pub. L. 102–83, § 5(a), Aug. 6, 1991, 105 Stat. 406.)

CITE AS: 38 USC 1909

§ 1910. Incontestability

Subject to the provisions of section 1911 of this title all contracts or policies of insurance heretofore or hereafter issued, reinstated, or converted shall be incontestable from the date of issue, reinstatement, or conversion except for fraud, nonpayment of premium, or on the ground that the applicant was not a member of the military or naval forces of the United States. However, in any case in which a contract or policy of insurance is canceled or voided after March 16, 1954, because of fraud, the Secretary shall refund to the insured, if living, or, if deceased, to the person designated as beneficiary (or if none survives, to the estate of the insured) all money, without interest, paid as premiums on such contract or policy for any period subsequent to two years after the date such fraud induced the Secretary to issue, reinstate, or convert such insurance less any dividends, loan, or other payment made to the insured under such contract or policy.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1149, § 710; renumbered § 1910 and amended Pub. L. 102–83, §§ 4(a)(2)(A)(iii)(II), (b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 403–406.)

CITE AS: 38 USC 1910

§ 1911. Forfeiture

Any person guilty of mutiny, treason, spying, or desertion, or who, because of conscientious objections, refuses to perform service in the Armed Forces of the United States or refuses to wear the uniform of such force, shall forfeit all rights to National Service Life Insurance. No insurance shall be payable for death inflicted as a lawful punishment for crime or for military or naval offense, except when inflicted by an enemy of the United States; but the cash surrender value, if any, of such insurance on the date of such death shall be paid to the designated beneficiary, if living, or otherwise to the beneficiary or beneficiaries within the permitted class in accordance with the order specified in section 1916(b) of this title.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1150, § 711; renumbered § 1911 and amended Pub. L. 102–83, § 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 406.)

CITE AS: 38 USC 1911

§ 1912. Total disability waiver
(a) Upon application by the insured and under such regulations as the Secretary may promulgate, payment of premiums on insurance may be waived during the continuous total disability of the insured, which continues or has continued for six or more consecutive months, if such disability began (1) after the date of the insured’s application for insurance, (2) while the insurance was in force under premium-paying conditions, and (3) before the insured’s sixty-fifth birthday. Notwithstanding any other provision of this chapter, in any case in which the total disability of the insured commenced on or after the insured’s sixtieth birthday but before the insured’s sixty-fifth birthday, the Secretary shall not grant waiver of any premium becoming due prior to January 1, 1965.
(b) The Secretary, upon any application made after August 1, 1947, shall not grant waiver of any premium becoming due more than one year before the receipt by the Secretary of application for the same, except as provided in this section. Any premiums paid for months during which waiver is effective shall be refunded. The Secretary shall provide by regulations for examination or reexamination of an insured claiming benefits under this section, and may deny benefits for failure to cooperate. If it is found that an insured is no longer totally disabled, the waiver of premiums shall cease as of the date of such finding and the policy of insurance may be continued by payment of premiums as provided in said policy. In any case in which the Secretary finds that the insured’s failure to make timely application for waiver of premiums or the insured’s failure to submit satisfactory evidence of the existence or continuance of total disability was due to circumstances beyond the insured’s control, the Secretary may grant waiver or continuance of waiver of premiums.
(c) If the insured dies without filing application for waiver, the beneficiary, within one year after the death of the insured, or, if the beneficiary is insane or a minor, within one year after removal of such legal disability, may file application for waiver with evidence of the insured’s right to waiver under this section. Premium rates shall be calculated without charge for the cost of waiver of premiums provided in this section and no deduction from benefits otherwise payable shall be made on account thereof.
(d) In any case in which an insured has been denied or would have been denied premium waiver under section 602(n) of the National Service Life Insurance Act of 1940 or this section solely because the insured became totally disabled between the date of valid application for insurance and the subsequent effective date thereof, and in which it is shown that (1) the total disability was incurred in line of duty between October 8, 1940, and July 31, 1946, inclusive, or June 27, 1950, and April 30, 1951, inclusive, and (2) the insured remained continuously so totally disabled to the date of death or June 8, 1960, whichever is earlier, the Secretary may grant waiver of premiums from the beginning of and during the continuous total disability of such insured. Application for waiver of premiums under this subsection must be filed by the insured or, in the event of the insured’s death, by the beneficiary within two years after June 8, 1960, except that if the insured or the beneficiary be insane or a minor within the two-year period, application for such waiver may be filed within two years after removal of such legal disability, or if an insane insured shall die before the removal of the disability, application may be filed by the beneficiary within two years after the insured’s death. No insurance shall be placed in force under this subsection in any case in which there was an award of benefits under the Servicemen’s Indemnity Act of 1951 or of gratuitous insurance under section 1922(b) of this title. The amount of insurance placed in force hereunder together with any other United States Government life insurance or national service life insurance in force at the time of death, or at the time of the insured’s application for waiver hereunder, may not exceed $10,000 and shall be reduced by the amount of any gratuitous insurance awarded under the National Service Life Insurance Act of 1940. Waiver of premiums under this subsection shall render the insurance nonparticipating during the period such premium waiver is in effect. The cost of waiver of premium and death benefits paid as a result of this subsection shall be borne by the United States.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1150, § 712; Pub. L. 86–497, June 8, 1960, 74 Stat. 164; Pub. L. 88–364, July 7, 1964, 78 Stat. 302; Pub. L. 97–295, § 4(23), Oct. 12, 1982, 96 Stat. 1306; Pub. L. 99–576, title VII, § 701(25), Oct. 28, 1986, 100 Stat. 3292; renumbered § 1912 and amended Pub. L. 102–83, §§ 4(a)(2)(C)(ii), (b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1912

§ 1913. Death before six months’ total disability

Whenever premiums are not waived under section 1912 of this title solely because the insured died prior to the continuance of total disability for six months, and proof of such facts, satisfactory to the Secretary, is filed by the beneficiary with the Department within one year after the insured’s death, the insurance shall be deemed to be in force at the date of the death, and the unpaid premiums shall become a lien against the proceeds of the insurance. If the beneficiary is insane or a minor, proof of such facts may be filed within one year after removal of such legal disability.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1150, § 713; Pub. L. 99–576, title VII, § 701(26), Oct. 28, 1986, 100 Stat. 3292; renumbered § 1913 and amended Pub. L. 102–83, §§ 4(a)(3), (4), (b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1913

§ 1914. Statutory total disabilities

Without prejudice to any other cause of disability, the permanent loss of the use of both feet, of both hands, or of both eyes, or of one foot and one hand, or of one foot and one eye, or of one hand and one eye, or the total loss of hearing of both ears, or the organic loss of speech, shall be deemed total disability for insurance purposes.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1151, § 714; renumbered § 1914, Pub. L. 102–83, § 5(a), Aug. 6, 1991, 105 Stat. 406.)

CITE AS: 38 USC 1914

§ 1915. Total disability income provision

The Secretary shall, except as hereinafter provided, upon application by the insured and proof of good health satisfactory to the Secretary and payment of such extra premium as the Secretary shall prescribe, include in any National Service Life Insurance policy on the life of the insured (except a policy issued under section 620 of the National Service Life Insurance Act of 1940, or section 1922 of this title) provisions whereby an insured who is shown to have become totally disabled for a period of six consecutive months or more commencing after the date of such application and before attaining the age of sixty-five and while the payment of any premium is not in default, shall be paid monthly disability benefits from the first day of the seventh consecutive month of and during the continuance of such total disability of $10 for each $1,000 of such insurance in effect when such benefits become payable. The total disability provision authorized under this section shall not be issued unless application therefor is made either prior to the insured’s fifty-fifth birthday, or before the insured’s sixtieth birthday and prior to January 1, 1966. The total disability provision authorized under this section shall not be added to a policy containing the total disability coverage heretofore issued under section 602(v) of the National Service Life Insurance Act of 1940, or the provisions of this section as in effect before January 1, 1965, except upon surrender of such total disability coverage, proof of good health, if required, satisfactory to the Secretary, and payment of such extra premium as the Secretary shall determine is required in such cases. Participating policies containing additional provisions for the payment of disability benefits may be separately classified for the purpose of dividend distribution from otherwise similar policies not containing such benefits.

(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1151, § 715; Pub. L. 88–355, July 7, 1964, 78 Stat. 272; renumbered § 1915 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1915

§ 1916. Insurance which matured before August 1, 1946
(a) Insurance which matured before August 1, 1946, is payable in the following manner:
(1) If the beneficiary to whom payment is first made was under thirty years of age at the time of maturity, in two hundred and forty equal monthly installments.
(2) If the beneficiary to whom payment is first made was thirty or more years of age at the time of maturity, in equal monthly installments for one hundred and twenty months certain, with such payments continuing during the remaining lifetime of such beneficiary.
(3) If elected by the insured or a beneficiary entitled to make such an election under prior provisions of law, as a refund life income in monthly installments payable for such period certain as may be required in order that the sum of the installments certain, including a last installment of such reduced amount as may be necessary, shall equal the face value of the contract, less any indebtedness, with such payments continuing throughout the lifetime of the first beneficiary. A refund life income optional settlement is not available in any case in which such settlement would result in payments of installments over a shorter period than one hundred and twenty months. If the mode of payment is changed to a refund life income in accordance with prior provisions of law, after payment has commenced, payment of monthly installments will be adjusted as of the date of maturity of such policy with credit being allowed for payments previously made on the insurance.
(b) Such insurance shall be payable only to a widow, widower, child, parent, brother or sister of the insured. Any installments certain of such insurance remaining unpaid at the death of any beneficiary shall be paid in equal monthly installments in an amount equal to the monthly installments paid to the first beneficiary, to the person or persons then in being within the following classes, and in the order named, unless designated by the insured in a different order:
(1) To the widow or widower of the insured, if living.
(2) If no widow or widower, to the child or children of the insured, if living, in equal shares.
(3) If no widow, widower, or child, to the parent or parents of the insured who last bore that relationship, if living, in equal shares.
(4) If no widow, widower, child, or parent, to the brothers and sisters of the insured, if living, in equal shares.
(c) The provisions of this section shall not be construed to enlarge the classes of beneficiaries heretofore authorized under section 602(d) of the National Service Life Insurance Act of 1940, for payment of gratuitous insurance.
(d) If no beneficiary of insurance which matured before August 1, 1946, was designated by the insured or if the designated beneficiary did not survive the insured, the beneficiary shall be determined in accordance with the order specified in subsection (b) and the insurance shall be payable in equal monthly installments in accordance with subsection (a). The right of any beneficiary to payment of any installments of such insurance shall be conditioned upon his or her being alive to receive such payments. No person shall have a vested right to any installment or installments of any such insurance and any installments not paid to a beneficiary during such beneficiary’s lifetime shall be paid to the beneficiary or beneficiaries within the permitted class next entitled to priority, as provided in subsection (b).
(e) No installments of insurance which matured before August 1, 1946, shall be paid to the heirs or legal representatives as such of the insured or of any beneficiary, and if no person within the permitted class survives to receive the insurance or any part thereof no payment of the unpaid installments shall be made, except that if the reserve of a contract of converted National Service Life Insurance, together with dividends accumulated thereon, less any indebtedness under such contract, exceeds the aggregate amount paid to beneficiaries, the excess shall be paid to the estate of the insured unless the estate of the insured would escheat under the laws of the insured’s place of residence, in which event no payment shall be made. When the amount of an individual monthly payment of such insurance is less than $5, such amount may, in the discretion of the Secretary, be allowed to accumulate without interest and be disbursed annually.
(f) Any payments of insurance made to a person, represented by the insured to be within the permitted class of beneficiaries, shall be deemed to have been properly made and to satisfy fully the obligation of the United States under such insurance policy to the extent of such payments.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1151, § 716; Pub. L. 99–576, title VII, § 701(27), Oct. 28, 1986, 100 Stat. 3292; renumbered § 1916 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406; Pub. L. 102–86, title V, § 506(a)(2), Aug. 14, 1991, 105 Stat. 426.)

CITE AS: 38 USC 1916

§ 1917. Insurance maturing on or after August 1, 1946
(a)
(1) A person who enrolls in insurance maturing on or after August 1, 1946, may designate a beneficiary of the insurance policy. The insured shall, subject to regulations, at all times have the right to change the beneficiary or beneficiaries of such insurance without the consent of such beneficiary or beneficiaries.
(2) If a person enrolled in insurance maturing on or after August 1, 1946, does not designate a beneficiary under paragraph (1) before the veteran dies, or if a designated beneficiary predeceases the veteran, the Secretary shall determine the beneficiary in the following order:
(A) The surviving spouse of the insured person.
(B) The children of the insured person and descendants of deceased children by representation.
(C) The parents of the insured person or the survivors of the parents.
(D) The duly appointed executor or administrator of the estate of the insured person.
(E) Other next of kin of the insured person entitled under the laws of domicile of the insured person at the time of the death of the insured person.
(b) Insurance maturing on or after August 1, 1946, shall be payable in accordance with the following optional modes of settlement:
(1) In one sum.
(2) In equal monthly installments of from thirty-six to two hundred and forty in number, in multiples of twelve.
(3) In equal monthly installments for one hundred and twenty months certain with such payments continuing during the remaining lifetime of the first beneficiary.
(4) As a refund life income in monthly installments payable for such period certain as may be required in order that the sum of the installments certain, including a last installment of such reduced amount as may be necessary, shall equal the face value of the contract, less any indebtedness, with such payments continuing throughout the lifetime of the first beneficiary; however, such optional settlement shall not be available in any case in which such settlement would result in payments of installments over a shorter period than one hundred and twenty months.
(c) Except as provided in the second and third sentences of this subsection, unless the insured elects some other mode of settlement, such insurance shall be payable to the designated beneficiary or beneficiaries in thirty-six equal monthly installments. The first beneficiary may elect to receive payment under any option which provides for payment over a longer period of time than the option elected by the insured, or if no option has been elected by the insured, in excess of thirty-six months. In the case of insurance maturing after September 30, 1981, and for which no option has been elected by the insured, the first beneficiary may elect to receive payment in one sum. If the option selected requires payment to any one beneficiary of monthly installments of less than $10, the amount payable to such beneficiary shall be paid in such maximum number of monthly installments as are a multiple of twelve as will provide a monthly installment of not less than $10. If the present value of the amount payable at the time any person initially becomes entitled to payment thereof is not sufficient to pay at least twelve monthly installments of not less than $10 each, such amount shall be payable in one sum. Options (3) and (4) shall not be available if any firm, corporation, legal entity (including the estate of the insured), or trustee is beneficiary.
(d) If the beneficiary of such insurance is entitled to a lump-sum settlement but elects some other mode of settlement and dies before receiving all the benefits due and payable under such mode of settlement, the present value of the remaining unpaid amount shall be payable to the estate of the beneficiary. If no beneficiary is designated by the insured, or if the designated beneficiary does not survive the insured, or if a designated beneficiary not entitled to a lump-sum settlement survives the insured, and dies before receiving all the benefits due and payable, then the commuted value of the remaining unpaid insurance (whether accrued or not) shall be paid in one sum to the estate of the insured. In no event shall there be any payment to the estate of the insured or of the beneficiary of any sums unless it is shown that any sums paid will not escheat.
(e) Under such regulations as the Secretary may promulgate, the cash surrender value of any policy of insurance or the proceeds of an endowment contract which matures by reason of completion of the endowment period may be paid to the insured under option (2) or (4) of this section. All settlements under option (4), however, shall be calculated on the basis of The Annuity Table for 1949. If the option selected requires payment of monthly installments of less than $10, the amount payable shall be paid in such maximum number of monthly installments as are a multiple of twelve as will provide a monthly installment of not less than $10.
(f)
(1) Following the death of the insured and in a case not covered by subsection (d)—
(A) if the first beneficiary otherwise entitled to payment of the insurance does not make a claim for such payment within one year after the death of the insured, payment may be made to another beneficiary designated by the insured, in the order of precedence as designated by the insured, as if the first beneficiary had predeceased the insured; and
(B) if, within two years after the death of the insured, no claim has been filed by a person designated by the insured as a beneficiary and the Secretary has not received any notice in writing that any such claim will be made, payment may (notwithstanding any other provision of law) be made to such person as may in the judgment of the Secretary be equitably entitled thereto.
(2) Payment of insurance under paragraph (1) shall be a bar to recovery by any other person.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1152, § 717; Pub. L. 91–291, § 10, June 25, 1970, 84 Stat. 331; Pub. L. 97–66, title IV, § 403(a), Oct. 17, 1981, 95 Stat. 1031; renumbered § 1917 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406; Pub. L. 108–183, title I, § 103(a), Dec. 16, 2003, 117 Stat. 2655; Pub. L. 117–313, §§ 2(a), 3(a), Dec. 27, 2022, 136 Stat. 4399.)

CITE AS: 38 USC 1917

§ 1918. Assignments
(a) Assignments of all or any part of the beneficiary’s interest may be made by a designated beneficiary to a widow, widower, child, father, mother, grandfather, grandmother, brother, or sister of the insured, when the designated contingent beneficiary, if any, joins the beneficiary in the assignment, and if the assignment is delivered to the Secretary before any payments of the insurance shall have been made to the beneficiary. However, an interest in an annuity, when assigned, shall be payable in equal monthly installments in such multiple of twelve as most nearly equals the number of installments certain under such annuity, or in two hundred and forty installments, whichever is the lesser. The provisions of this subsection shall not be applicable to insurance maturing after July 26, 1962.
(b) Except as to insurance granted under the provisions of section 1922(b) of this title, any person to whom insurance maturing after July 26, 1962, is payable may assign all or any portion of such person’s interest in such insurance to a widow, widower, child, father, mother, grandfather, grandmother, brother, or sister of the insured when the designated contingent beneficiary, if any, joins the beneficiary in the assignment. Such joinder shall not be required in any case in which the insurance proceeds are payable in a lump sum.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1153, § 718; Pub. L. 87–557, § 1, July 27, 1962, 76 Stat. 245; Pub. L. 96–128, title III, § 304, Nov. 28, 1979, 93 Stat. 986; Pub. L. 97–295, § 4(24), Oct. 12, 1982, 96 Stat. 1306; renumbered § 1918 and amended Pub. L. 102–83, §§ 4(a)(2)(A)(iii)(III), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 403, 406.)

CITE AS: 38 USC 1918

§ 1919. National Service Life Insurance appropriation
(a) The National Service Life Insurance appropriation is continued and there is authorized to be appropriated, out of any money in the Treasury not otherwise appropriated, such sums as may be necessary to carry out the provisions of this chapter and the provisions heretofore prescribed in the National Service Life Insurance Act of 1940, or related Acts, for the payment of liabilities under National Service Life Insurance. Payment from this appropriation shall be made upon and in accordance with awards by the Secretary.
(b) All premiums heretofore and hereafter paid on insurance issued or reinstated under section 602(v)(1) of the National Service Life Insurance Act of 1940 where the requirement of good health was waived under such section because of a service-incurred injury or disability shall be credited directly to the National Service Life Insurance appropriation and any payments of benefits heretofore and hereafter made on such insurance shall be made directly from such appropriation.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1154, § 719; Pub. L. 98–160, title VII, § 702(5), Nov. 21, 1983, 97 Stat. 1009; renumbered § 1919 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406; Pub. L. 105–368, title III, § 304(a), Nov. 11, 1998, 112 Stat. 3334.)

CITE AS: 38 USC 1919

§ 1920. National Service Life Insurance Fund
(a) The National Service Life Insurance Fund heretofore created in the Treasury is continued as a permanent trust fund. Except as otherwise provided in this chapter, all premiums paid on account of National Service Life Insurance shall be deposited and covered into the Treasury to the credit of such fund, which, together with interest earned thereon, shall be available for the payment of liabilities under such insurance, including payment of dividends and refunds of unearned premiums, and for the reimbursement of administrative costs under subsection (c). Payments from this fund shall be made upon and in accordance with awards by the Secretary.
(b) The Secretary is authorized to set aside out of such fund such reserve amounts as may be required under accepted actuarial principles to meet all liabilities under such insurance; and the Secretary of the Treasury is authorized to invest and reinvest such fund, or any part thereof, in interest-bearing obligations of the United States or in obligations guaranteed as to principal and interest by the United States, and to sell such obligations for the purposes of such fund.
(c)
(1) For each fiscal year for which this subsection is in effect, the Secretary shall, from the National Service Life Insurance Fund, reimburse the “General operating expenses” account of the Department for the amount of administrative costs determined under paragraph (2) for that fiscal year. Such reimbursement shall be made from any surplus earnings for that fiscal year that are available for dividends on such insurance after claims have been paid and actuarially determined reserves have been set aside. However, if the amount of such administrative costs exceeds the amount of such surplus earnings, such reimbursement shall be made only to the extent of such surplus earnings.
(2) The Secretary shall determine the administrative costs to the Department for a fiscal year for which this subsection is in effect which, in the judgment of the Secretary, are properly allocable to the provision of National Service Life Insurance (and to the provision of any total disability income insurance added to the provision of such insurance).
(3) This subsection shall be in effect only with respect to fiscal year 1996.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1154, § 720; renumbered § 1920 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406; Pub. L. 104–99, title II, § 201(b), Jan. 26, 1996, 110 Stat. 36.)

CITE AS: 38 USC 1920

§ 1921. Extra hazard costs
(a) The United States shall bear the excess mortality cost and the cost of waiver of premiums on account of total disability traceable to the extra hazard of military or naval service, as such hazard may be determined by the Secretary.
(b) Whenever benefits under insurance become payable because of the death of the insured as the result of disease or injury traceable to the extra hazard of military or naval service, as such hazard may be determined by the Secretary, the liability for payment of such benefits shall be borne by the United States in an amount which, when added to the reserve of the policy at the time of death of the insured will equal the then value of such benefits under such policy. Where life contingencies are involved in the calculation of the value of such benefits of insurance heretofore or hereafter matured, the calculation of such liability or liabilities shall be based upon such mortality table or tables as the Secretary may prescribe with interest at the rate of 3 per centum per annum. The Secretary shall transfer from time to time from the National Service Life Insurance appropriation to the National Service Life Insurance Fund such sums as may be necessary to carry out the provisions of this section.
(c) Whenever the premiums under insurance are waived because of the total disability of the insured as the result of disease or injury traceable to the extra hazard of military or naval service, as such hazard may be determined by the Secretary, the premiums so waived shall be paid by the United States and the Secretary shall transfer from time to time an amount equal to the amount of such premiums from the National Service Life Insurance appropriation to the National Service Life Insurance Fund.
(d) Whenever benefits under the total disability income provision become, or have become, payable because of total disability of the insured as a result of disease or injury traceable to the extra hazard of the military or naval service, as such hazard may be determined by the Secretary, the liability shall be borne by the United States, and the Secretary shall transfer from the National Service Life Insurance appropriation to the National Service Life Insurance Fund from time to time any amounts which become, or have become, payable to the insured on account of such total disability, and to transfer from the National Service Life Insurance Fund to the National Service Life Insurance appropriation the amount of the reserve held on account of the total disability benefit. When a person receiving such payments on account of total disability recovers from such disability, and is then entitled to continue protection under the total disability income provision, the Secretary shall transfer to the National Service Life Insurance Fund a sum sufficient to set up the then required reserve on such total disability benefit.
(e) Any disability for which a waiver was required as a condition to tendering a person a commission under Public Law 816, Seventy-seventh Congress, shall be deemed to be a disability resulting from an injury or disease traceable to the extra hazard of military or naval service for the purpose of applying this section.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1154, § 721; renumbered § 1921 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1921

§ 1922. Legacy service disabled veterans’ insurance
(a) Any person who is released from active military, naval, air, or space service, under other than dishonorable conditions on or after April 25, 1951, and is found by the Secretary to be suffering from a disability or disabilities for which compensation would be payable if 10 per centum or more in degree and except for which such person would be insurable according to the standards of good health established by the Secretary, shall, upon application in writing made within two years from the date service-connection of such disability is determined by the Secretary and payment of premiums as provided in this subchapter, be granted insurance by the United States against the death of such person occurring while such insurance is in force. If such a person is shown by evidence satisfactory to the Secretary to have been mentally incompetent during any part of the two-year period, application for insurance under this section may be filed within two years after a guardian is appointed or within two years after the removal of such disability as determined by the Secretary, whichever is the earlier date. If the guardian was appointed or the removal of the disability occurred before January 1, 1959, application for insurance under this section may be made within two years after that date. Insurance granted under this section shall be issued upon the same terms and conditions as are contained in the standard policies of National Service Life Insurance except (1) the premium rates for such insurance shall be based on the Commissioners 1941 Standard Ordinary Table of Mortality and interest at the rate of 2¼ per centum per annum; (2) all cash, loan, paid-up, and extended values shall be based upon the Commissioners 1941 Standard Ordinary Table of Mortality and interest at the rate of 2¼ per centum per annum; (3) all settlements on policies involving annuities shall be calculated on the basis of The Annuity Table for 1949, and interest at the rate of 2¼ per centum per annum; (4) insurance granted under this section shall be on a nonparticipating basis and all premiums and other collections therefor shall be credited directly to a revolving fund in the Treasury of the United States, and any payments on such insurance shall be made directly from such fund; and (5) administrative support financed by the appropriations for “General Operating Expenses, Department of Veterans Affairs” and “Information Technology Systems, Department of Veterans Affairs” for the program of insurance under this section shall be paid from premiums credited to the fund under paragraph (4), and payments for claims against the fund under paragraph (4) for amounts in excess of amounts credited to such fund under that paragraph (after such administrative costs have been paid) shall be paid from appropriations to the fund. Appropriations to such fund are hereby authorized. As to insurance issued under this section, waiver of premiums pursuant to section 602(n) of the National Service Life Insurance Act of 1940 and section 1912 of this title shall not be denied on the ground that the service-connected disability became total before the effective date of such insurance.
(b)
(1) Any person who, on or after April 25, 1951, was otherwise qualified for insurance under the provisions of section 620 of the National Service Life Insurance Act of 1940, or under subsection (a) of this section, but who did not apply for such insurance and who is shown by evidence satisfactory to the Secretary (A) to have been mentally incompetent from a service-connected disability, (i) at the time of release from active service, or (ii) during any part of the two-year period from the date the service connection of a disability is first determined by the Secretary, or (iii) after release from active service but is not rated service-connected disabled by the Secretary until after death; and (B) to have remained continuously so mentally incompetent until date of death; and (C) to have died before the appointment of a guardian, or within two years after the appointment of a guardian; shall be deemed to have applied for and to have been granted such insurance, as of the date of death, in an amount which, together with any other United States Government or National Service life insurance in force, shall aggregate $10,000. The date to be used for determining whether such person was insurable according to the standards of good health established by the Secretary, except for the service-connected disability, shall be the date of release from active service or the date the person became mentally incompetent, whichever is the later.
(2) Payments of insurance granted under subsection (b)(1) of this section shall be made only to the following beneficiaries and in the order named—
(A) to the widow or widower of the insured, if living and while unremarried;
(B) if no widow or widower entitled thereto, to the child or children of the insured, if living, in equal shares;
(C) if no widow or widower or child entitled thereto, to the parent or parents of the insured who last bore that relationship, if living, in equal shares.
(3) No application for insurance payments under this subsection shall be valid unless filed with the Secretary within two years after the date of death of the insured or before January 1, 1961, whichever is the later, and the relationship of the applicant shall be proved as of the date of death of the insured by evidence satisfactory to the Secretary. Persons shown by evidence satisfactory to the Secretary to have been mentally or legally incompetent at the time the right to apply for death benefits expires, may make such application at any time within one year after the removal of such disability.
(4) Notwithstanding section 1917 of this title, insurance under this subsection shall be payable to the beneficiary determined under paragraph (2) of this subsection in a lump sum.
(c) The premium rate of any term insurance issued under this section shall not exceed the renewal age 70 premium rate.
(d)
(1) The Secretary may not accept any application by a veteran to be insured under this section after December 31, 2022.
(2)
(A) During the period beginning January 1, 2023, and ending December 31, 2025, a veteran who is insured under this section may elect to instead be insured under section 1922B of this title based on the age of the veteran at the time of such election.
(B)
(i) A veteran who elects under subparagraph (A) to be insured under section 1922B of this title shall be subject to the two-year waiting period specified in subsection (c) of such section.
(ii) If the veteran dies during such period, the Secretary shall pay the beneficiary under this section, and, if applicable, under section 1922A, plus the amount of premiums paid by the veteran under such section 1922B, plus interest.
(3) Except as provided by paragraph (2)(B), a veteran may not be insured under this section and section 1922B simultaneously.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1155, § 722; renumbered § 1922 and amended Pub. L. 102–83, §§ 4(a)(2)(A)(iii)(IV), (D)(i), (b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 403–406; Pub. L. 102–86, title II, §§ 201(a), 202(a), Aug. 14, 1991, 105 Stat. 415, 416; Pub. L. 103–446, title XII, § 1201(i)(2), Nov. 2, 1994, 108 Stat. 4688; Pub. L. 106–419, title III, § 311(a), Nov. 1, 2000, 114 Stat. 1854; Pub. L. 110–389, title IV, § 404, Oct. 10, 2008, 122 Stat. 4175; Pub. L. 111–117, div. E, title II, § 226, Dec. 16, 2009, 123 Stat. 3307; Pub. L. 116–283, div. A, title IX, § 926(a)(32), Jan. 1, 2021, 134 Stat. 3830; Pub. L. 116–315, title II, § 2004(b)(1), (c)(1), Jan. 5, 2021, 134 Stat. 4974.)

CITE AS: 38 USC 1922

§ 1922A. Legacy supplemental service disabled veterans’ insurance for totally disabled veterans
(a) Any person insured under section 1922(a) of this title who qualifies for a waiver of premiums under section 1912 of this title is eligible, as provided in this section, for supplemental insurance in an amount not to exceed $30,000.
(b) To qualify for supplemental insurance under this section a person must file with the Secretary an application for such insurance. Such application must be filed not later than (1) October 31, 1993, or (2) the end of the one-year period beginning on the date on which the Secretary notifies the person that the person is entitled to a waiver of premiums under section 1912 of this title, whichever is later. The Secretary may not accept any such application after December 31, 2022. Except as provided by section 1922(d)(2)(B), a veteran may not have supplemental insurance under this section and be insured under section 1922B simultaneously.
(c) Supplemental insurance granted under this section shall be granted upon the same terms and conditions as insurance granted under section 1922(a) of this title, except that such insurance may not be granted to a person under this section unless the application is made for such insurance before the person attains 65 years of age.
(d) No waiver of premiums shall be made in the case of any person for supplemental insurance granted under this section.
(Added Pub. L. 102–568, title II, § 203(a), Oct. 29, 1992, 106 Stat. 4324; amended Pub. L. 103–446, title XII, § 1201(f)(1), Nov. 2, 1994, 108 Stat. 4687; Pub. L. 111–275, title IV, § 401(a), Oct. 13, 2010, 124 Stat. 2879; Pub. L. 116–315, title II, § 2004(b)(2), (c)(2), Jan. 5, 2021, 134 Stat. 4974.)

CITE AS: 38 USC 1922A

§ 1922B. Service-disabled veterans insurance
(a)Insurance.—
(1) Beginning January 1, 2023, the Secretary shall carry out a service-disabled veterans insurance program under which a veteran is granted insurance by the United States against the death of such individual occurring while such insurance is in force.
(2) The Secretary may only issue whole-life policies under the insurance program under paragraph (1).
(3) The Secretary may not grant insurance to a veteran under paragraph (1) unless—
(A) the veteran submits the application for such insurance before the veteran attains 81 years of age; or
(B) with respect to a veteran who has attained 81 years of age—
(i) the veteran filed a claim for compensation under chapter 11 of this title before attaining such age;
(ii) based on such claim, and after the veteran attained such age, the Secretary first determines that the veteran has a service-connected disability; and
(iii) the veteran submits the application for such insurance during the two-year period following the date of such determination.
(4)
(A) A veteran enrolled in the insurance program under paragraph (1) may elect to be insured in any of the following amounts:
(i) $10,000.
(ii) $20,000.
(iii) $30,000.
(iv) $40,000.
(v) In accordance with subparagraph (B), a maximum amount greater than $40,000.
(B) The Secretary may establish a maximum amount to be insured under paragraph (1) that is greater than $40,000 if the Secretary—
(i) determines that such maximum amount and the premiums for such amount—(I) are administratively and actuarially sound for the insurance program under paragraph (1); and(II) will not result in such program operating at a loss; and
(ii) publishes in the Federal Register, and submits to the Committee on Veterans’ Affairs of the Senate and the Committee on Veterans’ Affairs of the House of Representatives, such maximum amount and determination.
(5)
(A)
(i) Insurance granted under this section shall be on a nonparticipating basis and all premiums and other collections therefor shall be credited directly to a revolving fund in the Treasury of the United States.
(ii) Any payments on such insurance shall be made directly from such fund.
(B)
(i) The Secretary of the Treasury may invest in and sell and retire special interest-bearing obligations of the United States for the account of the revolving fund under subparagraph (A).
(ii) Such obligations issued for that purpose shall—(I) have maturities fixed with due regard for the needs of the fund; and(II) bear interest at a rate equal to the average market yield (computed by the Secretary of the Treasury on the basis of market quotations as of the end of the calendar month preceding the date of issue) on all marketable interest-bearing obligations of the United States then forming a part of the public debt which are not due or callable until after the expiration of four years from the end of such calendar month; except that where such average market yield is not a multiple of one-eighth of one per centum, the rate of interest of such obligation shall be the multiple of one-eighth of one per centum nearest such market yield.
(6)
(A) Administrative support financed by the appropriations for “General Operating Expenses, Department of Veterans Affairs” and “Information Technology Systems, Department of Veterans Affairs” for the insurance program under paragraph (1) shall be paid from premiums credited to the fund under paragraph (5).
(B) Such payment for administrative support shall be reimbursed for that fiscal year from funds that are available on such insurance after claims have been paid.
(b)Eligibility.—A veteran is eligible to enroll in the insurance program under subsection (a)(1) if the veteran has a service-connected disability, without regard to—
(1) whether such disability is compensable under chapter 11 of this title; or
(2) whether the veteran meets standards of good health required for other life insurance policies.
(c)Enrollment and Waiting Period.—
(1) An eligible veteran may enroll in the insurance program under subsection (a)(1) at any time.
(2) The life insurance policy of a veteran who enrolls in the insurance program under subsection (a)(1) does not go into force unless—
(A) a period of two years elapses following the date of such enrollment; and
(B) the veteran pays the premiums required during such two-year period.
(3)
(A) If a veteran dies during the two-year period described in paragraph (2), the Secretary shall pay to the beneficiary of the veteran the amount of premiums paid by the veteran under this section, plus interest.
(B) The Secretary—
(i) for the initial year of the insurance program under subsection (a)(1)—(I) shall set such interest at a rate of one percent; and(II) may adjust such rate during such year based on program experience, except that the interest rate may not be less than zero percent;
(ii) for the second and each subsequent year of the program, shall calculate such interest at an annual rate equal to the rate of return on the revolving fund under subsection (a)(5) for the calendar year preceding the year of the veteran’s death, except that the interest rate may not be less than zero percent; and
(iii) on an annual basis, shall publish on the internet website of the Department the average interest rate calculated under clause (ii) for the preceding calendar year.
(d)Premiums.—
(1) The Secretary shall establish a schedule of basic premium rates by age per $10,000 of insurance under subsection (a)(1) consistent with basic premium rates generally charged for guaranteed acceptance life insurance policies by private life insurance companies.
(2) The Secretary may adjust such schedule after the first policy year in a manner consistent with the general practice of guaranteed acceptance life insurance policies issued by private life insurance companies.
(3)Section 1912 of this title shall not apply to life insurance policies under subsection (a)(1), and the Secretary may not otherwise waive premiums for such insurance policies.
(e)Beneficiaries.—
(1) A veteran who enrolls in the insurance program under subsection (a)(1) may designate a beneficiary of the life insurance policy.
(2) If a veteran enrolled in the insurance program under subsection (a)(1) does not designate a beneficiary under paragraph (1) before the veteran dies, or if a designated beneficiary predeceases the veteran, the Secretary shall determine the beneficiary in the following order:
(A) The surviving spouse of the veteran.
(B) The children of the veteran and descendants of deceased children by representation.
(C) The parents of the veteran or the survivors of the parents.
(D) The duly appointed executor or administrator of the estate of the veteran.
(E) Other next of kin of the veteran entitled under the laws of domicile of the veteran at the time of the death of the veteran.
(f)Claims.—
(1) If the deceased veteran designated a beneficiary under subsection (e)(1)—
(A) the designated beneficiary is the only person who may file a claim for payment under subsection (g) during the one-year period beginning on the date of the death of the veteran; and
(B) if the designated beneficiary does not file a claim for the payment during the period described in paragraph (1), or if payment to the designated beneficiary within that period is prohibited by Federal statute or regulation, a beneficiary described in subsection (e)(2) may file a claim for such payment during the one-year period following the period described in subparagraph (A) as if the designated beneficiary had predeceased the veteran.
(2) If the deceased veteran did not designate a beneficiary under subsection (e)(1), or if the designated beneficiary predeceased the veteran, a beneficiary described in subsection (e)(2) may file a claim for payment under subsection (g) during the two-year period beginning on the date of the death of the veteran.
(3) If, on the date that is two years after the date of the death of the veteran, no claim for payment has been filed by any beneficiary pursuant to paragraph (1) or (2), and the Secretary has not received notice that any such claim will be so filed during the subsequent one-year period, the Secretary may make the payment to a claimant whom the Secretary determines to be equitably entitled to such payment.
(g)Payments.—
(1) In a case described in subsection (f)—
(A) in paragraph (1)(A), the Secretary shall pay the designated beneficiary not later than 90 days after the designated beneficiary files a complete and valid claim for payment;
(B) in paragraph (1)(B) or (2), the Secretary shall make any payment not later than one year after the end of the period described in the applicable such paragraph, if the Secretary receives a complete and valid claim for payment in accordance with the applicable such paragraph; or
(C) in paragraph (3), the Secretary shall make any payment not later than one year after the end of the period described in such paragraph, if the Secretary receives a complete and valid claim for payment.
(2) In a case where the Secretary has not made an insurance payment under this section during the applicable period specified in paragraph (1) by reason of a beneficiary not yet having filed a claim, or the Secretary not yet making a determination under subsection (f)(3), the Secretary may make the payment after such applicable period.
(3) Notwithstanding section 1917 of this title, the Secretary shall make an insurance payment under this section in a lump sum.
(4) The Secretary may not make an insurance payment under this section if such payment will escheat to a State.
(5) Any payment under this subsection shall be a bar to recovery by any other person.
(Added Pub. L. 116–315, title II, § 2004(a)(1), Jan. 5, 2021, 134 Stat. 4970.)

CITE AS: 38 USC 1922B

§ 1923. Veterans’ Special Life Insurance
(a) Insurance heretofore granted under the provisions of section 621 of the National Service Life Insurance Act of 1940, against the death of the policyholder occurring while such insurance is in force, is subject to the same terms and conditions as are contained in standard policies of National Service Life Insurance on the five-year level premium term plan except (1) such insurance may not be exchanged for or converted to insurance on any other plan; (2) the premium rates for such insurance shall be based on the Commissioners 1941 Standard Ordinary Table of Mortality and interest at the rate of 2¼ per centum per annum; (3) all settlements on policies involving annuities shall be calculated on the basis of The Annuity Table for 1949, and interest at the rate of 2¼ per centum per annum; (4) all premiums and other collections on such insurance and any total disability provisions added thereto shall be credited to a revolving fund in the Treasury of the United States, which, together with interest earned thereon, shall be available for the payment of liabilities under such insurance and any total disability provisions added thereto, including payments of dividends and refunds of unearned premiums, and for the reimbursement of administrative costs under subsection (d).
(b) Any term insurance heretofore issued under section 621 of the National Service Life Insurance Act of 1940, may be converted to a permanent plan of insurance or exchanged for a policy of limited convertible five-year level premium term insurance issued under this subsection. Insurance issued under this subsection shall be issued upon the same terms and conditions as are contained in the standard policies of National Service Life Insurance except (1) after September 1, 1960, limited convertible term insurance may not be issued or renewed on the term plan after the insured’s fiftieth birthday; (2) the premium rates for such limited convertible term or permanent plan insurance shall be based on table X–18 (1950–54 Intercompany Table of Mortality) and interest at the rate of 2½ per centum per annum; (3) all settlements on policies involving annuities on insurance issued under this subsection shall be calculated on the basis of The Annuity Table for 1949, and interest at the rate of 2½ per centum per annum; (4) all cash, loan, paid-up, and extended values, and, except as otherwise provided in this subsection, all other calculations in connection with insurance issued under this subsection shall be based on table X–18 (1950–54 Intercompany Table of Mortality) and interest at the rate of 2½ per centum per annum; (5) all premiums and other collections on insurance issued under this subsection and any total disability income provisions added thereto shall be credited directly to the revolving fund referred to in subsection (a) of this section, which together with interest earned thereon, shall be available for the payment of liabilities under such insurance and any total disability provisions added thereto, including payments of dividends and refunds of unearned premiums.
(c) The Secretary is authorized to invest in, and the Secretary of the Treasury is authorized to sell and retire, special interest-bearing obligations of the United States for the account of the revolving fund with a maturity date as may be agreed upon by the two Secretaries. The rate of interest on such obligations shall be fixed by the Secretary of the Treasury at a rate equal to the rate of interest, computed as of the end of the month preceding the date of issue of such obligations, borne by all marketable interest-bearing obligations of the United States then forming a part of the public debt that are not due or callable until after the expiration of five years from the date of original issue; except that where such average rate is not a multiple of one-eighth of 1 per centum, the rate of interest of such obligations shall be the multiple of one-eighth of 1 per centum nearest such average rate.
(d)
(1) For each fiscal year for which this subsection is in effect, the Secretary shall, from the Veterans’ Special Life Insurance Fund, reimburse the “General operating expenses” account of the Department for the amount of administrative costs determined under paragraph (2) for that fiscal year. Such reimbursement shall be made from any surplus earnings for that fiscal year that are available for dividends on such insurance after claims have been paid and actuarially determined reserves have been set aside. However, if the amount of such administrative costs exceeds the amount of such surplus earnings, such reimbursement shall be made only to the extent of such surplus earnings.
(2) The Secretary shall determine the administrative costs to the Department for a fiscal year for which this subsection is in effect which, in the judgment of the Secretary, are properly allocable to the provision of Veterans’ Special Life Insurance (and to the provision of any total disability income insurance added to the provision of such insurance).
(3) This subsection shall be in effect only with respect to fiscal year 1996.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1157, § 723; Pub. L. 85–896, Sept. 2, 1958, 72 Stat. 1716; Pub. L. 87–223, Sept. 13, 1961, 75 Stat. 495; Pub. L. 93–289, § 2(a), May 24, 1974, 88 Stat. 165; renumbered § 1923 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(C), (E), 5(a), Aug. 6, 1991, 105 Stat. 404–406; Pub. L. 104–99, title II, § 201(b), Jan. 26, 1996, 110 Stat. 36.)

CITE AS: 38 USC 1923

§ 1924. In-service waiver of premiums
(a) Waiver of all premiums on five-year level premium term insurance and that portion of any permanent insurance premiums representing the cost of the pure insurance risk, as determined by the Secretary, granted on National Service Life Insurance or United States Government life insurance under section 622 of the National Service Life Insurance Act of 1940 and in effect on January 1, 1959, shall, unless canceled, continue in effect according to the provisions of such section for the remainder of the insured’s continuous active service and for one hundred and twenty days thereafter. Such premium waiver renders the contract of insurance nonparticipating during the period the waiver is in effect.
(b) Whenever benefits become payable because of the maturity of such insurance while under the premium waiver continued by this section, liability for payment of such benefits shall be borne by the United States in an amount which, when added to any reserve of the policy at the time of maturity, will equal the then value of such benefits under such policy. Where life contingencies are involved in the calculation of the value of such benefits, the calculation of such liability or liabilities shall be based upon such mortality table or tables as the Secretary may prescribe with interest at the rate of 2¼ per centum per annum as to insurance issued under sections 620 and 621 of the National Service Life Insurance Act of 1940, at the rate of 3 per centum per annum as to other National Service Life Insurance, and 3½ per centum per annum as to United States Government life insurance. The Secretary shall transfer from time to time from the National Service Life Insurance appropriation to the National Service Life Insurance Fund and from the military and naval insurance appropriation to the United States Government Life Insurance Fund such sums as may be necessary to carry out the provisions of this section.
(c) In any case in which insurance continued in force under this section matures on or after January 1, 1972, an amount equal to the amount of premiums, less dividends, waived on and after that date shall be placed as an indebtedness against the insurance and, unless otherwise paid, shall be deducted from the proceeds. In such case, the liability of the Government under subsection (b) of this section shall be reduced by the amount so deducted from the proceeds.
(Pub. L. 85–857, Sept. 2, 1958, 72 Stat. 1157, § 724; Pub. L. 92–197, § 7, Dec. 15, 1971, 85 Stat. 662; renumbered § 1924 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1924

§ 1925. Limited period for acquiring insurance
(a) Any person (other than a person referred to in subsection (f) of this section) heretofore eligible to apply for National Service Life Insurance after October 7, 1940, and before January 1, 1957, who is found by the Secretary to be suffering (1) from a service-connected disability or disabilities for which compensation would be payable if 10 percent or more in degree and except for which such person would be insurable according to the standards of good health established by the Secretary; or (2) from a non-service-connected disability which renders such person uninsurable according to the standards of good health established by the Secretary and such person establishes to the satisfaction of the Secretary that such person is unable to obtain commercial life insurance at a substandard rate, shall, upon application in writing made before May 2, 1966, compliance with the health requirements of this section and payment of the required premiums, be granted insurance under this section.
(b) If, notwithstanding the applicant’s service-connected disability, such person is insurable according to the standards of good health established by the Secretary, the insurance granted under this section shall be issued upon the same terms and conditions as are contained in the standard policies of National Service Life Insurance except (1) five-year level premium term insurance may not be issued; (2) the net premium rates shall be based on the 1958 Commissioners Standard Ordinary Basic Mortality Table, increased at the time of issue by such an amount as the Secretary determines to be necessary for sound actuarial operations, and thereafter such premiums may be adjusted as the Secretary determines to be so necessary but at intervals of not less than two years; (3) an additional premium to cover administrative costs to the Government as determined by the Secretary at times of issue shall be charged for insurance issued under this subsection and for any total disability income provision attached thereto, and thereafter such costs may be adjusted as the Secretary determines to be necessary but at intervals of not less than five years; (4) all cash, loan, extended and paid-up insurance values shall be based on the 1958 Commissioners Standard Ordinary Basic Mortality Table; (5) all settlements on policies involving annuities shall be calculated on the basis of The Annuity Table for 1949; (6) all calculations in connection with insurance issued under this subsection shall be based on interest at the rate of 3½ percent per annum; and (7) the insurance shall include such other changes in terms and conditions as the Secretary determines to be reasonable and practicable.
(c) If the applicant’s service-connected disability or disabilities render the applicant uninsurable according to the standards of good health established by the Secretary, or if the applicant has a non-service-connected disability which renders the applicant uninsurable according to the standards of good health established by the Secretary and such person establishes to the satisfaction of the Secretary that such person is unable to obtain commercial life insurance at a substandard rate and such uninsurability existed as of the date of approval of this section, the insurance granted under this section shall be issued upon the same terms and conditions as are contained in standard policies of National Service Life Insurance, except (1) five-year level premium term insurance may not be issued; (2) the premiums charged for the insurance issued under this subsection shall be increased at the time of issue by such an amount as the Secretary determines to be necessary for sound actuarial operations and thereafter such premiums may be adjusted from time to time as the Secretary determines to be necessary; for the purpose of any increase at time of issue or later adjustment the service-connected group and the non-service-connected group may be separately classified; (3) an additional premium to cover administrative costs to the Government as determined by the Secretary at the time of issue shall be charged for insurance issued under this subsection and for any total disability income provision attached thereto (for which the insured may subsequently become eligible) and thereafter such costs may be adjusted as the Secretary determines to be necessary but at intervals of not less than five years and for this purpose the service-connected and non-service-connected can be separately classified; (4) all settlements on policies involving annuities shall be calculated on the basis of The Annuity Table for 1949; (5) all calculations in connection with insurance issued under this subsection shall be based on interest at the rate of 3½ percent per annum; and (6) the insurance shall include such other changes in terms and conditions as the Secretary determines to be reasonable and practicable.
(d)
(1) All premiums and collections on insurance issued pursuant to this section and any total disability income provision attached thereto shall be credited to the Veterans Reopened Insurance Fund, a revolving fund established in the Treasury of the United States, and all payments on such insurance and any total disability provision attached thereto, including payments of dividends and refunds of unearned premiums, shall be made from that fund and the interest earned on the assets of that fund. For actuarial and accounting purposes, the assets and liabilities (including liabilities for repayment of advances hereinafter authorized, and adjustment of premiums) attributable to the insured groups established under this section shall be separately determined. Such amounts in the Veterans Special Term Insurance Fund in the Treasury, not exceeding $1,650,000 in the aggregate, as may hereafter be determined by the Secretary to be in excess of the actuarial liabilities of that fund, including contingency reserves, shall be available for transfer to the Veterans Reopened Insurance Fund as needed to provide initial capital. Any amounts so transferred shall be repaid to the Treasury over a reasonable period of time with interest as determined by the Secretary of the Treasury taking into consideration the average yield on all marketable interest-bearing obligations of the United States of comparable maturities then forming a part of the public debt.
(2) The Secretary is authorized to set aside out of the revolving fund established under this section such reserve amounts as may be required under accepted actuarial principles to meet all liabilities on insurance issued under this section and any total disability income provision attached thereto. The Secretary of the Treasury is authorized to invest in and to sell and retire special interest-bearing obligations of the United States for the account of the revolving fund. Such obligations issued for this purpose shall have maturities fixed with due regard for the needs of the fund and shall bear interest at a rate equal to the average market yield (computed by the Secretary of the Treasury on the basis of market quotations as of the end of the calendar month next preceding the date of issue) on all marketable interest-bearing obligations of the United States then forming a part of the public debt which are not due or callable until after the expiration of four years from the end of such calendar month; except that where such average market yield is not a multiple of one-eighth of 1 percent, the rate of interest of such obligation shall be the multiple of one-eighth of 1 percent nearest such market yield.
(3) Notwithstanding the provisions of section 1982 of this title, the Secretary shall, from time to time, determine the administrative costs to the Government which in the Secretary’s judgment are properly allocable to insurance issued under this section and any total disability income provision attached thereto, and shall transfer from the revolving fund, the amount of such cost allocable to the Department to the appropriations for “General Operating Expenses and Information Technology Systems, Department of Veterans Affairs”, and the remainder of such cost to the general fund receipts in the Treasury. The initial administrative costs of issuing insurance under this section and any total disability income provision attached thereto shall be so transferred over such period of time as the Secretary determines to be reasonable and practicable.
(e) Notwithstanding the provisions of section 1982 of this title, a medical examination (including any supplemental examination or tests) when required of an applicant for issuance of insurance under this section or any total disability income provisions attached thereto shall be at the applicant’s own expense by a duly licensed physician.
(f) No insurance shall be granted under this section to any person referred to in section 107 of this title or to any person while on active duty or active duty for training under a call or order to such duty for a period of thirty-one days or more.
(Added Pub. L. 88–664, § 12(a), Oct. 13, 1964, 78 Stat. 1096, § 725; amended Pub. L. 89–40, June 14, 1965, 79 Stat. 130; Pub. L. 96–128, title III, § 301, Nov. 28, 1979, 93 Stat. 985; Pub. L. 97–295, § 4(25), Oct. 12, 1982, 96 Stat. 1306; Pub. L. 99–576, title VII, § 701(28), Oct. 28, 1986, 100 Stat. 3292; renumbered § 1925 and amended Pub. L. 102–83, §§ 4(a)(2)(B)(ii), (3), (4), (b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 403–406; Pub. L. 111–117, div. E, title II, § 225, Dec. 16, 2009,

CITE AS: 38 USC 1925

§ 1926. Authority for higher interest rates for amounts payable to beneficiaries

Notwithstanding sections 1902, 1923, and 1925 of this title, if the beneficiary of an insurance policy receives the proceeds of such policy under a settlement option under which such proceeds are paid in equal monthly installments over a limited period of months, the interest that may be added to each such installment may be at a rate that is higher than the interest rate prescribed in the appropriate section of this subchapter. The Secretary may from time to time establish a higher interest rate under the preceding sentence only in accordance with a determination that such higher rate is administratively and actuarially sound for the program of insurance concerned. Any such higher interest rate shall be paid on the unpaid balance of such monthly installments.

(Added Pub. L. 96–128, title III, § 302(a), Nov. 28, 1979, 93 Stat. 986, § 726; renumbered § 1926 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1926

§ 1927. Authority for higher monthly installments payable to certain annuitants
(a) Subject to subsections (b) and (c) of this section, the Secretary may from time to time adjust the dollar amount of the monthly installments payable to a beneficiary of National Service Life Insurance, Veterans Special Life Insurance, or Veterans Reopened Insurance who is receiving the proceeds of such insurance under a life annuity settlement option. The Secretary may make such an adjustment only if the Secretary determines that the adjustment is administratively and actuarially sound for the program of insurance concerned. The Secretary may make such an adjustment without regard to the provisions of sections 1902, 1923, and 1925 of this title with respect to interest rates and the use of mortality tables.
(b) The Secretary shall determine the amount in the trust funds in the Treasury held for payment of proceeds to National Service Life Insurance, Veterans Special Life Insurance, and Veterans Reopened Insurance beneficiaries attributable to interest and mortality gains on the reserves held for annuity accounts. Such amount shall be available for distribution to the life annuitants referred to in subsection (a) of this section as a fixed percentage of, and in addition to, the monthly installment amount to which the annuitants are entitled under this subchapter. For the purposes of this section, gains on the reserves are defined as funds attributable solely to annuity accounts that are in excess of actuarial liabilities.
(c) The monthly amount of an annuity authorized in sections 1902, 1923, and 1925 of this title, as adjusted under this section, may not be less than the monthly amount of such annuity that would otherwise be applicable without regard to this section.
(Added Pub. L. 100–322, title III, § 331(a)(1), May 20, 1988, 102 Stat. 536, § 727; renumbered § 1927 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1927

§ 1928. Authority for payment of interest on settlements
(a) Subject to subsection (b) of this section, the Secretary may pay interest on the proceeds of a participating National Service Life Insurance, Veterans’ Special Life Insurance, and Veterans Reopened Insurance policy from the date the policy matures to the date of payment of the proceeds to the beneficiary or, in the case of an endowment policy, to the policyholder.
(b)
(1) The Secretary may pay interest under subsection (a) of this section only if the Secretary determines that the payment of such interest is administratively and actuarially sound for the settlement option involved.
(2) Interest paid under subsection (a) of this section shall be at the rate that is established by the Secretary for dividends held on credit or deposit in policyholders’ accounts under the insurance program involved.
(Added Pub. L. 100–687, div. B, title XIV, § 1401(a)(1), Nov. 18, 1988, 102 Stat. 4128, § 728; renumbered § 1928 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1928

§ 1929. Authority to adjust premium discount rates
(a) Notwithstanding sections 1902, 1923, and 1925 of this title and subject to subsection (b) of this section, the Secretary may from time to time adjust the discount rates for premiums paid in advance on National Service Life Insurance, Veterans’ Special Life Insurance, and Veterans Reopened Insurance.
(b)
(1) In adjusting a discount rate pursuant to subsection (a) of this section, the Secretary may not set such rate at a rate lower than the rate authorized for the program of insurance involved under section 1902, 1923, or 1925 of this title.
(2) The Secretary may make an adjustment under subsection (a) of this section only if the Secretary determines that the adjustment is administratively and actuarially sound for the program of insurance involved.
(Added Pub. L. 100–687, div. B, title XIV, § 1401(b)(1), Nov. 18, 1988, 102 Stat. 4129, § 729; renumbered § 1929 and amended Pub. L. 102–83, §§ 4(b)(1), (2)(E), 5(a), (c)(1), Aug. 6, 1991, 105 Stat. 404–406.)

CITE AS: 38 USC 1929