**August 6, 1973 M29-1, Part VI**

**CONTENTS**

CHAPTER l. GENERAL

PARAGRAPH PAGE\
1.01 Historical Background l-l\
1.02 Jurisdiction 1-2\
1.03 General Responsibility of Personnel 1-2\
1.04 Finality of Decisions 1-2\
1.05 Initiation of Claim 1-2\
1.06 Types of Awards 1-3\
1.07 Confidential Nature of Inforrnation in Folders 1-3\
1.08 Filing Records and Documents 1-3

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August 6,1973 M29-1, Part VI

**CHAPTER 1. GENERAL**

**1.01 HISTORICAL BACKGROUND**

a\. Government life insurance had its development during World Wars I
and II and the Korean conflict and is divided into two major programs:
USGLI (United States Government Life Insurance) (World War I) and NSLI
(National Service Life Insurance) (World War II and later).

b\. Under policies issued to World War I and World War II veterans, the
Government assumed the obligation to

pay not only the cost of the extra hazard of military or naval service,
but also to bear the cost of administration of the insurance programs.
Special funds known as the Military and Naval Insurance appropriation
(USGLI) and the National Service Life Insurance appropriation (NSLI)
were established for this purpose. Extra-hazard costs are paid from
these special funds.

c\. Prior to July 1, 1972, no person could carry a combined amount of
National Service Life Insurance and United States Government Life
Insurance in excess of \$ 10,000 at any one time. Public Law 92-188,
which became effective July 1, 1972, authorized NSLI policyholders to
use dividends to buy more insurance protection as paid-up additions,
thereby exceeding the \$ 10,000 limit in certain cases.

d\. United States Government Life Insurance. Policies issued under this
program are prefixed with a K. The program started in May 1919 with the
issuance of permanent plan insurance, with term insurance becoming
available on June 2,1926. This insurance could not be purchased after
April 24, 1951.

e\. National Service Life Insurance. This program became effective
October 8, 1940, and terminated the issuance of USGLI policies, except
to World War I veterans. Its purpose was to service World War II
veterans and it became the largest single insurance program in history.
The first policies issued were prefixed by the letter N. On and after
January l, 1954, policies were issued with a V-prefix. This insurance
could not be purchased after April24,1951.

f\. From August 1, 1946, through December 31, 1949, certain veterans who
could not meet the required health standards were issued an NSLI policy
prefixed with the letter H in lieu of V. Premiums paid on these

policies are deposited in the appropriation fund and clairns are paid
from the same fund.

g\. From April 25, 1951, through December 31, 1956, NSLI policies were
issued as 5-year level premium term (5LPT) prefrxed with the letters RS.
Application had to be made within 120 days after separation from
service. Effective January 1, 1959, these RS policies could be exchanged
for a convertible limited 5LPT or permanent plan. These new policies
were prefixed with the letter W.

h\. From May 1, 1965, through May 2, 1966, NSLI was reopened to issue
policies to certain disabled veterans. Veterans who had active military
service from October 8, 1940, and through April 24,1951, or who entered
active duty on April 25, 1951, or later and were separated before
January I, 1957, and had service connected disabilities, and could meet
standard health requirements were issued policies prefixed by the letter
J. Persons on active duty could not buy this insurance. Veterans meeting
the same eligibility date mles, but whose service-connected disabilities
prevented them from meeting good health requirements, were issued
policies prefrxed with the letters JR. These JR policies were issued at
substandard premium rates. Those veterans meeting the same eligibility
dates as for J and JR insurance, but who had non-service-connected
disabilities which alone, or in combination with service-connected
disibilities, impaired their health to make them totally uninsurable
commercially, were issued policies prefixed with the letters JS. Those
veterans had to have their disabilities as of October 13, 1964.

i\. The only type of NSLI insurance now being issued is the Service
Disabled Veterans Insurance. These policies are issued to veterans
separated from the service on or after April 25, 1951, with
service-connected disabilities, which would be compensable if 10 percent
or more in degree and who are otherwise in good health. Applications for
this insurance must be made within 1 year after notification of a
disability rating by the VA. Policies issued under this program are
prefixed by the letters RH.

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**M29-1, Part VI** **August 6,** **1973**

j\. ARH-Gratuitous NSLI. Any person who, on or after April 25, 1951, was
otherwise qualified for RH insurance, but who did not apply for such
insurance, may be granted gratuitous insurance if he was mentally
incompetent from a service-connected disability at the time of release
from active service or during any part of the l-year period from the
date the service-connected disability is first determined by the VA, or
after release from active service but not rated service connected until
after death. The veteran must have remained continuously imcompetent
until date of death and must have died before, or within l year after
the appointment of a guardian. Claim must be filed within 2 years after
death. Payment of the proceeds of such a policy can be paid only to a
restricted class of beneficiaries.

**1.02 JURISDICTION**

a\. The Insurance Death Claims activities in the St. Paul and
Philadelphia VA centers are responsible for the processing and
adjudication of insurance claims for:

\(1\) Proceeds of insurance matured by death of policyholders.

\(2\) Unpaid amounts of matured endowments after death of insureds.

\(3\) Unpaid amounts under total disability riders after death of
insureds.

b\. The Philadelphia office is assigned exclusive jurisdiction over
adjudication of insurance death claims involving United States
Government Life Insurance (K), Yearly Renewable Term Insurance (T, I,
AI) and Initial Awards of Gratuitous National Service Life Insurance
(AN). They also process all cases initiated from the Manila regional
office after October 28, 1971.

c\. After December 1,1967, the Philadelphia and St. Paul VA centers were
authorized to retain all insurance folders on death cases, including
those in which settlement is authorized in monthly installments. The
XC-folder is maintained by the regional office having jurisdiction.

**1.03 GENERAL RESPONSIBILITY OF PERSONNEL**

All death claims received should be processed as expeditiously as
possible. The general policy of the Death Claims activity is to give the
claimant every opportunity to substantiate his or her claim, to extend
all reasonable assistance in its prosecution, and to develop all sources
from which information may be obtained. Information and advice to
claimants will be complete and expressed in plain language which can be
easily read and understood by persons not familiar with our terminology
or subject matter.

**1.04 FINALITY OF DECISIONS**

Previous determinations on which an award was predicated, including
decisions of questions of age, marriage, relationship, service,
dependency, line of duty and other facts, will be accepted as correct in
the absence of clear and unmistakable error or fraud.

**1.05 INITIATION OF CLAIM**

a\. Upon receipt of the VA Form 29-368d, Report of Status for Settlement
of Death Claims, the Death Claims activity will take prompt action to
determine if death benefits are payable.

b\. If the insurance is payable to a competent adult, insured\'s minor
widow, or minor emancipated by service in the Armed Forces, legal entity
other than a trustee or an estate, a VA FL 29-72 will be forwarded to
such beneficiary at his or her latest address of record. (See ch. 3,
par. 3.03.) Beneficiaries need not submit policies when making a claim.

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May 27, 1980 M29-1 Part VI\
Change 3

**1.06 TYPES OF AWARDS**

a\. An *Original Award* is the initial settlement to the beneficiary
entitled to the insurance following the death of the insured. This
includes total and permanent disability installments (USGLI) if the
beneficiary does not elect to continue these installments, and those
awards in which the first check(s) is returned by the beneficiary
requesting a change in option.

b\. A *Supplemental Award* is prepared when the information being
changed or added does not affect the face amount of Insurance, the
amount of the loan, or loan interest.

c\. *An Amended Award* is prepared when the information being changed or
added affects the face amount of insurance payable.

d\. An *Adjustment Award* is prepared when:

\(1\) T&P disability entitlement is determined after settlement of the
death award.

\(2\) Assignment of installments certain after payments have commenced
in option 3 or 4 settlements.

\(3\) Change in insured\'s age after settlement which affects the face
amount of insurance.

\(4\) Beneficiary originally entitled to payment in one sum requests
partial commuted value after payments have commenced.

\(5\) Beneficiaries repay their share of indebtedness against the policy
before their payments commence.

\(6\) Change in share of payee.

\(7\) Beneficiary re uests-a change in option during the first year.

\(8\) The pincipal bene rec\'ing instl under opt2 & contingent is
entitled to CIV

e\. A *Commuted Value Award* is restricted to those cases in which the
payee on a running award requests the full commuted value of the
remaining unpaid installments.

f\. A Total and Permanent Disability Installment Continued Award on
USGLI is prepared in those cases in which the beneficiary elects to
receive the remainder of the 240 installments following the death of the
insured or the death of the prior payee.

g\. A *Matured Endowment Award* is prepared when the insured failed to
survive any payments, and payment of th endowment proceeds will be made
to his or her estate or beneficiary.

h\. A contingent award is prepared when a beneficiary is entitled to
unpaid installments following the death of the principal beneficiary and
any prior contingent beneficiaries. (In the case of gratuitous
insurance, a contingent award is als prepared when the insured\'s spouse
remarries.)

**1.07 CONFIDENTIAL NATURE OF INFORMATION IN FOLDERS**

\[Under the provisions of the Privacy Act of 1974 (PL 93-579) insurance
records are confidential. Disclosure to individual requesting
information about the insured and/or beneficiaries will be made as
provided in MP-1, part II, chapter 2l.\]

**1.08 FILING RECORDS AND DOCUMENTS**

a\. Return of Original Records. Original records which are to be
returned will not be stamped, stapled, punched or marked instead, the
date of receipt will be stamped on a paper tag and fastened to the
original record. The original record will be

stored in the folder in an envelope (punched for filing) on which the
contents will be briefly described. Before the documen is returned to
the claimant, a photostat or certified true copy will be made and filed,
containing a certification signed by th

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**M29-1, Part VI May 27, 1980**

**Change 3**

employee releasing it as to the date and VA office at which the original
was received. The term, original record, is not to be strictly
construed. Any nonoriginal document which, because of age, issuance by a
foreign government or other factor, has high sentimental value and is
irreplaceable or replaceable only at considerable effort or cost, may be
treated as an original record.

b\. Copies Prohibited. The reproduction of the following documents is
forbidden by law: (l) U.S. certificates of citizenship or
naturalization, (2) U.S. passports, and (3) U.S. immigration papers. A
memorandum for file will be made identifying the record, the date the
original was received, including a resume of pertinent contents, signed
by a claims examiner or authorizer. The originals will be returned to
the sender.

c\. Filing. Extreme care will be exercised in punching holes properly
and in filing records and documents in a neat, orderly banner to
facilitate easy reading, turning of pages, and preservation. Records and
documents will be filed in order of date of receipt, the most recent on
top. (Only slight variation in this order is permitted, if it will
improve continuity.)

d\. The filing of documents will be as follows:

\(l\) Inside Left Flap. This section is reserved for filing the types of
forms enumerated below. They will be filed in chronological order,
except that notices of overpayment or indebtedness of the veteran will
be kept on top of other material until the overpayment or indebtedness
is satisfied.

\(a\) Application for insurance, renewal, conversion, change of
beneficiary, etc.

\(b\) Awards, stop award and suspend or resume pay notices,
disallowances, and code sheets pertaining to insurance benefits.

\(c\) VA Form 4-5851, Insurance Awards Statement.

\(d\) Change of name.

\(e\) VA Form 1-670, Appeal Record Card.

\(t\) VA Form 29-368d.

\(2\) **Inside Right** **Flap.** All other material including
correspondence, claim and option forms and documents submitted in
;support of claims in this section in order of date of receipt, or, as
to file copies of correspondence released, date of release.

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