**November 30, 1984 M27-1, Part I**

**Change 22**

**CONTENTS**

**CHAPTER 11. INSURANCE PROGRAM**

**PARAGRAPH PAGE**

**SUBCHAPTER I. GENERAL**

11.01 Request for Insurance Information 11-1

11.02 Premium Payment Advice 11-1

11.03 Beneficiary Designations and Optional Settlements 11-1

11.04 Survivor Claims for Insurance Proceeds 11-2

11.05 Hospitalized Incompetent Veterans and Requests for Insurance
Status 11-2

11.06 Application for Service Disabled Veterans Insurance 11-2

**SUBCHAPTER II. ADMINISTRATIVE**

11.07 Claims for Disability Insurance Benefits\--Subordinate Locations
11-3

11.08 Disability Insurance Claims and Insurance Service
Requests\--Regional Offices 11-4

11.09 Initial Claims 11-4

11.10 Transfer of Folders 11-5

11.11 Medical Examinations 11-6

.

**SUBCHAPTER III. SERVICEMEN\'S GROUP LIFE INSURANCE**

11.12 Interviews With Veterans Who Are Within the 120-Day Period
Following

Separation 11-6

11.13 Veteran Request for Assistance 11-7

11.14 Beneficiary Requests for Assistance 11-7

**SUBCHAPTER IV. POLICY LOAN OR REFUND REQUESTS**

11.15 Regular Policy Loans 11-8

11.16 Emergency Loan or Withdrawal Procedure 11-8

**SUBCHAPTER V. WAIVER OF PREMIUMS AND TDIP (TOTAL DISABILITY**

**INCOME PROVISION) ASSISTANCE**

11.17 Waiver of Premiums 11-9

11.18 TDIP (Total Disability Income Provision) 11-10

11.19 Insurance Assistance Outreach 11-10

**11-i**

**November 30, 1984 M27-1, Part I**

**Change 22**

**CHAPTER 11. INSURANCE PROGRAM**

**SUBCHAPTER I. GENERAL**

**11.01 REQUEST FOR INSURANCE INFORMATION**

a\. Requests for insurance information by VSD (Veterans Services
Division) personnel will be made only when the requested information
will serve as a basis for further VSD action. Normally, technical
personnel will assist the insured in preparing a request for information
or action over the veteran\'s signature so that the information will be
furnished directly to him or her by the VA regional office and insurance
center.

b\. Inquiries on insurance matters should include insurance file
number(s) and/or policy number(s). If the insurance numbers are not
available, the employee will request the number(s) through BIRLS
(Beneficiary Identification and Records Locator Subsystem) before a
submission of the inquiry. The FTS, ARS (Advanced Record System) or VA
Form 3232, General Information Request, may be used for routine VSD
inquiries.

**11.02\] PREMIUM PAYMENT ADVICE**

In order to facilitate crediting premium payments to insurance accounts
and contribute substantially to the reduction of administrative cost,
all interviews with insureds who are paying premiums on a monthly basis,
should include an explanation of the advantages of paying on a
quarterly, semiannual, or annual basis. Insureds will be advised as to
how remittances should be identified and the proper address to which
they should be directed. Under no circumstances will VSD employees
accept remittances for payment of insurance premiums. VSOs (Veterans
Services Officers) will highlight this prohibition at each formal
refresher training session.) Veterans receiving compensation should be
advised of the advantages of having the premium deducted from
compensation payments, particularly in interviews involving RH (Service
Disabled Veterans) insurance.

**11.03 BENEFICIARY DESIGNATIONS AND OPTIONAL SETTLEMENTS**

When appropriate, VSD personnel in conducting interviews with insureds
will ascertain that beneficiary designations and optional settlements
are in accord with the insured\'s current wishes. Inquiries on the part
of VSD personnel will be considered appropriate when the insured conveys
information indicating a change in his or her dependency status such as
the recent birth of a child, a death, marriage, or divorce.

CAUTION: While the insured may designate a trustee as beneficiary to
receive insurance proceeds for his or her minor children, technical
personnel will tactfully suggest that the minor children should be named
beneficiaries in their own right with the knowledge that the VA will
provide all possible legal assistance for the protection of children as
designated

beneficiaries.

**11-1**

**M27-1, Part I November 30, 1984**

**Change 22**

**11.04 SURVIVOR CLAIMS FOR INSURANCE PROCEEDS**

A high degree of discretion should be exercised in assisting persons
interested in applying for the proceeds of a Government insurance policy
unless they possess notification from the Philadelphia or St. Paul VA
regional office and insurance center that they are the designated
beneficiary or have other reasonable information to that effect. Claims
filed by persons who are not designated beneficiaries can result in
contested claims and delays in settlement. In cases of doubt, and if
agreeable to the applicant, a letter should be sent over the
applicant\'s signature asking for verification of beneficiary and
optional settlement designations preliminary to filing a formal claim.

**11.05 HOSPITALIZED INCOMPETENT VETERANS AND REQUESTS FOR**

**INSURANCE STATUS**

The procedures to follow for assistance to incompetent veterans
hospitalized in VA medical centers (use of VA Form 29-178, Request for
Insurance Status-Government Life Insurance) are contained in part III,
section I, chapter 3, paragraph 3.03, and section II, chapter 11,
paragraphs 11.02h and 11.15 of this manual. The same procedures apply to
patients in State mental institutions, or other non-VA hospitals.

**11.06 APPLICATION FOR SERVICE DISABLED VETERANS INSURANCE**

a\. Detailed procedures for assistance to hospitalized service personnel
and veterans in connection with service-disabled insurance, 38 U.S.C.
722, are set forth in part III, section II, chapter 11 of this manual.
VA personnel interviewing veterans at other than VA medical center
locations should also be fully trained in these procedures for use as
applicable in the activities at their locations.

b\. All personnel, when assisting a veteran in completing an original
claim for service connection or a supplemental claim and service on or
after April 25, 1951 is involved, will discuss service-disabled
insurance with the claimant. The advantages of filing simultaneously
with the disability claim will be clearly pointed out. Assistance in the
completion of VA Form 29-4364, Application for National Service Life
Insurance (RH) (Medical) will be provided, if the veteran desires such
assistance, there is no rating of incompetency or other legal disability
and the veteran has less than the statutory maximum amount or no NSLI
\[(National Service Life Insurance)\] or USGLI (United States Government
Life Insurance) in force. When indicated, the application will be
accompanied by VA Form 29-357, Claim for Disability Insurance Benefits.
It must be remembered that veterans are entitled to full Government life
insurance coverage, \$10,000, in addition to any SGLI (Servicemen\'s
Group Life Insurance) or VGLI (Veterans\' Group Life Insurance) they may
have. The advantages of a current effective date as compared to a future
effective date will be explained to the applicant in the event he or she
proposes a prospective effective date. The veteran should be encouraged
to pay 2 months\' premium upon initial application.

c\. As stated in M21-1, chapter 49, paragraph 49.06a(2)(a)5, a copy of
the rating sheet in potential terminal cases will be hand-delivered to
VSD when possible entitlement exists for RH insurance. In these
instances, the VSO will insure that a personal visit to the veteran is
initiated immediately to assist in the completion of all appropriate
applications.

d\. A VA interviewer or a third party other than a guardian cannot make
an application for RH insurance\] on behalf of a mentally incompetent
veteran. Incompetency includes persons in a comatose condition.
Application may only be made by the veteran or guardian. If required by
State law, the guardian must have court authorization to make the
application.

**11-2**

**November 30, 1984 M27-1, Part I**

**Change 22**

**SUBCHAPTER II. ADMINISTRATIVE**

**11.07 CLAIMS FOR DISABILITY INSURANCE BENEFITS-SUBORDINATE**

**LOCATIONS**

a\. A claim on VA Form 29-357 executed or received in a VSD activity
other than at a regional office or a VA medical center, will be
forwarded directly to the insurance center having custody of the
insured\'s records, if known; otherwise, to the insurance center having
jurisdiction over the area in which the insured resides, as indicated by
the current mailing address shown on VA Form 29-357.

b\. When VA Form 29-357 is executed in VA medical center VSD activities
by or on behalf of a patient, part I of the form should be detached and
sent to the appropriate VA regional office and insurance center (see
subpar. a above) to establish the claim. Part II of the form should be
routed to the Medical Administration Service for processing. Subsequent
transmittal of part II to the proper office will be the responsibility
of the Medical Administration Service. In lieu of the completion of part
II, an appropriate hospital summary or medical report may be used.

c\. When an applicant, other than a patient in a VA medical center, is
assisted in the execution of part I, VA Form 29-357, and part II cannot
be completed without delay, the applicant or his or her representative
should be furnished with part II of a blank VA Form 29-357, with items 1
through 3 completed and with instructions that the form should be
completed and forwarded promptly to the appropriate office of the VA. In
such cases, notation will be made on part I of the submitted form that a
form has been furnished the applicant or his or her representative for
completion by the appropriate medical authority.

**11.08 DISABILITY INSURANCE CLAIMS AND INSURANCE SERVICE**

**REQUESTS-REGIONAL OFFICES**

a\. The VSO is responsible for the processing of all claims for NSLI and
USGLl disability benefits received in a regional office. He or she is
also responsible for prompt compliance with requests for evidence,
folders, or examinations received from Insurance Claims and Underwriting
Sections.

b\. A disability insurance control file will be maintained in
chronological order in the VSD of the regional office having
jurisdiction over the claims folder. It will consist of VA Forms
29-1570, Request for Evidence, Folder and/or Examination, received or
prepared in VSD, and will be divided into an active and an inactive
section. The file will be used in connection with the prompt transfer of
claims, claims folders, or evidence required for use in adjudication of
claims for disability insurance benefits or in conjunction with
Insurance activity requests. Disposition of this file will be in
accordance with RCS (Records Control Schedule) VB-1, part I, item No.
6-002.1.

c\. In the case of a veteran who is applying for the Total Permanent
Disability Provision of USGLI, the insured should be reminded that all
USGLI policies are paid-up, requiring no more premium payments.
Therefore, the premium waiver feature of this provision no longer
applies. He or she should also be aware that the monthly income payments
of \$5.75 per \$1,000 of insurance in force which are paid to the
policyholder, mature the policy, causing all dividend payments to cease,
and reduce its face value.

**11-3**

**M27-1, Part I November 30, 1984**

**Change 22**

**11.09\] INITIAL CLAIMS**

a\. In all claims, the VSO will determine whether the claims folder
should accompany initial claims. Except when an examination is
scheduled, initial claims will be forwarded within 5 workdays to the
office to which the insured is making premium payments, if known;
otherwise, to the office having jurisdiction over the area in which the
insured resides. In all instances, VA Form 29-1570 will accompany the
claim. A copy will be retained for record purposes and placed in the
disability insurance control file.

b\. Upon receipt of VA Form 29-1570 requesting an examination, the VSO
will check the latest address of record in the claims folder against the
address shown on the form and then recharge the folder, with the
original and one copy of the form attached, to the appropriate Medical
activity of jurisdiction. Generally, the hospital or clinic selected
will be the one nearest the veteran\'s residence. The third copy with
appropriate notations as to action taken will be placed in the tickler
file.

\(1\) When a copy of VA Form 60-3542b, Authorization to Report-Voucher
for Mileage Allowance, is received from the clinic or hospital, the VSO
will note the scheduled examination date on the copy of VA Form 29-1570
and will forward the VA Form 60-3542b to the requesting Insurance Claims
or Underwriting Section. The insurance file number should be entered on
the VA Form 60-3542b.

\(2\) Upon receipt of the medical report, with a copy of VA Form 29-1570
attached, the VSO will transmit the report with the form completely
executed, by VA Form 3230, Reference Slip, to the requesting office.

\(3\) The control copy of VA Form 29-1570 will be completed and filed in
the inactive section of the control file for disposal in accordance with
\[RCS VB-1, part I, item 6002.1.

\(4\) The VSO will coordinate the necessary details for handling
insurance office requests for medical evidence with concerned
administrative personnel at affected VA clinics and hospitals.

c\. When a VA Form 29-1570 cannot be associated with a claims folder in
the regional office, the clinic or hospital will be so advised. The
Medical activity will determine whether the claims folder will be
required in conducting the requested examination. If the claims folder
is required, the \[VSO\] will take appropriate steps to locate the
claims folder and effect its transfer.

d\. Upon receipt of notification from the clinic or hospital that an
insured has failed to report for a scheduled examination and has given
no satisfactory reason for his or her failure to report, VA Form
29-1570, with an appropriate explanation, VSOs will be returned to the
insurance office of jurisdiction.

e\. In unusual cases, VSO may receive teletypes requesting expedited
action for medical reports. In processing such requests, the VSO will
prepare VA Form 29-1570 in triplicate and will followup as necessary to
expedite receipt of the evidence for forwarding to the requesting
office.

**11.10 TRANSFER OF FOLDERS**

a\. The claims folder will not be transferred if the claims folder
contains no information relating to the existence of disability within
the period claimed on part II of VA Form 29-357.

b\. Transfers of folders will be accomplished within 5 workdays from
receipt of a claim of VA Form 29-1570. When the immediate return of the
claims folder to the regional office is desired, the VSO will attach a
flash request. Procedures and controls, both local and BIRLS, as
outlined in M23-1, part I, will be followed in the transfer of any
claims folder.

**11-4**

**November 30, 1984 M27-1, Part I**

**Change 22**

c\. In those exceptional cases in which the claims folder cannot be
released, photocopies or abstracts of evidence for the period specified
on the VA Form 29-1570 will be prepared by the VSO. The reason for not
releasing the folder will be given and reference made to any outstanding
requests for service; private or VA medical records; and/or industrial
or social service reports in relation to any pending claim for
compensation or pension.

d\. The R&E (Rehabilitation and Education) folder will not be
transferred unless a specific request is made on the VA Form 29-1570. In
all cases where the VA Form 29-1570 indicates a \"Pending\" claim,
available local records will be reviewed to determine whether the
veteran is receiving vocational training. When applicable, information
will be furnished on VA Form 29-1570 relative to the beginning date,
place and type of training the insured is receiving.

**11.11 MEDICAL EXAMINATIONS**

a\. A physical examination will not be initiated by the \[VSO\] if the
VA Form 29-357 is accompanied by medical evidence which adequately
describes the veteran\'s condition from the approximate date which the
veteran alleges the disability began; or if the claims folder contains a
report of an official examination made within 90 days preceding the
receipt of the claim; or if the only disability claimed is permanent in
nature (USGLI).

b\. When the records indicate that the claims folder is located in
another regional office; or the Records Processing Center, or in the
Washington, D.C. regional office, VA Form 29-1570 will be prepared in
quintuplicate to indicate an original claim and will include all
necessary data as to name, address, service number of the insured,
Social Security and file numbers, and period of total disability and
treatment alleged. The original and two copies of VA Form 29-1570 will
be forwarded to the office of folder jurisdiction; one copy will be
attached to the VA Form 29-357 and sent to the requesting insurance
section, and one copy will be retained for record purposes to be
disposed of in accordance with \[RCS VB-1, part I, item No. 6-0021.

c\. When the record indicates the claims folder has been temporarily
transferred out, the office having insurance jurisdiction will be
advised by memorandum that transfer action will be initiated, if in
order, upon receipt of the returned

folder.

d\. In instances when the claim is received by mail, the insured will be
notified of the transfer of his or her claim for disability insurance
benefits.

**11-5**

**M27-1, Part I November 30, 1984**

**Change 22**

**SUBCHAPTER III. SERVICEMEN\'S GROUP LIFE INSURANCE**

**11.12 INTERVIEWS WITH VETERANS WHO ARE WITHIN THE 120-DAY**

**PERIOD FOLLOWING SEPARATION**

a\. In all interviews with veterans who are within the 120-day period
following separation, the subject of VGLI will be proposed. All veterans
who were insured by SGLI at separation are eligible to continue the
insurance as VGLI for 5 years beginning at the end of the insured period
which follows separation. Ordinarily this period is 120 days following
separation but, in the case of a veteran totally disabled at separation,
the insured period continues while total disability continues but not
beyond 1 year following separation. VSD personnel should advise the
veteran that, if he or she applies for VGLI within 120 days after
discharge, he or she does not have to meet good health requirements. If
the veteran fails to apply for VGLI within this 120-day period, he or
she has an additional year to apply but must meet health requirements.

b\. VGLI is group term insurance limited to a 5-year period which was
substituted for the original SGLI right to continue the insurance by
purchasing an individual policy at standard rates. The right to purchase
the individual policy is now available at the end of the VGLI period.

c\. VGLI premium rates are listed in VA Pamphlet 29-74-3, Information
Pamphlet for Converting Your Servicemen\'s Group Life Insurance to
Veterans\' Group Life Insurance.

d\. The VA attempts to send two VGLI applications to every separated
veteran. The initial application, SGLV 8714-1, (Application for Veterans
Group Life Insurance) is mailed to the address shown on the DD Form 214,
Report of Separation From Active Duty, within 120 days after discharge.
The second application, SGLV 8714-3, (Veterans Separated Less Than 120
Days) is mailed to the veteran 6 months later. Either application should
be completed and mailed with the initial

premium to the address shown on the form.

e\. Eligible veterans should be encouraged to participate in this
low-cost life insurance program. SGLV 8714, Application for Veterans
Group Life Insurance, (Veterans separated 120 Days or Less) or SGLV
8714-2 (Veterans Separated More Than 120 Days) should be provided to any
veteran who is still within the eligible application period and did not
receive, or does not have, the form mailed by the VA. Both forms contain
premium tables and mailing instructions.

f\. I Veterans insured in the VGLI program will be advised by the
company before the group coverage expires of their right to purchase
individual policies, and will be given a list of the companies issuing
such policies.

**11.13 VETERAN REQUEST FOR ASSISTANCE**

The OSGLI (Office of Servicemen\'s Group Life Insurance), 213 Washington
Street, Newark, New jersey 07102, administers the VGLI and Retired
Reservist SGLI programs. Applications for these programs and all changes
and requests for information should be sent to that office.

**11-6**

**November 30, 1984 M27-1, Part I**

**Change 22**

**11.14\] BENEFICIARY REQUESTS FOR ASSISTANCE**

a\. VSD personnel may be called upon to assist persons applying for
proceeds of SGLI when death occurs during the

insured period following separation (usually 120 days but up to 1 year
if totally disabled at separation). In all cases, OSGLI will have to
obtain insurance information, including the beneficiary designation,
from the service department.

b\. The person inquiring should be advised to write to OSGLI including
copy of DD Form 214 or equivalent identification, a certified copy of
the death certificate and the writer\'s name and address. Upon obtaining
the necessary information from the service department, OSGLI will advise
the writer of the action needed if the writer is the beneficiary, or
will inform the writer of the circumstances.

**SUBCHAPTER IV. POLICY LOAN OR REFUND REQUESTS**

**11.15 REGULAR POLICY LOANS**

a\. Life insurance policies issued by the VA on permanent plans have
policy reserves (cash values) against which loans may be made after the
policy has been in effect for 1 year. Term insurance policies do not
have this feature.

b\. Insureds having policies on which dividends are paid may use the
dividends to buy amounts of insurance to be added to the face value of
the policy. These amounts, called paid-up additions, may exist on both
permanent plan and term policies and in both cases have cash values
against which loans may be made.

c\. VA Form 29-1546, Application for Cash Surrender Value or Policy
Loan, is used to apply for policy loans or cash values of NSLI or USGLI
basic policies and/or paid-up additions.

d\. Insureds under policies eligible for dividends may allow their
dividends to remain with VA as interest-bearing dividend credits or
deposits. These credits or deposits may be withdrawn, all or any part
of, at any time. VA Forms 29-432(S)(St. Paul) or
29-432(P)(Philadelphia), Disposition of Dividends, may be used to
request withdrawal of dividend amounts.

e\. In ordinary cases, the insured should be provided with the
appropriate form and any additional information or assistance he or she
desires and advised to mail the form to the proper VA center.

**11.16 EMERGENCY LOAN OR WITHDRAWAL PROCEDURE**

a\. In unusual circumstances when the insured alleges an emergency and
needs to obtain available funds as promptly as possible, the following
procedure should be followed:

\(1\) Verify as far as possible that the insured does have the type of
policy or insurance on which a loan may be granted (note that any
earlier loan must have been repaid or will be deducted, with accrued
interest, from any loan value available)

or that the insured has accumulated dividends available for withdrawal.

**11-7**

**M27-1, Part I November 30, 1984**

**Change 22**

\(2\) Verify the insured\'s identity to the extent possible, preferably
by way of a driver\'s license containing identifying data and insured\'s
signature.

\(3\) Assist the insured in completing the appropriate form, verifying
to the extent possible that signatures compare favorably.

\(4\) If everything appears in order, call the appropriate VA center
using the following FTS (Federal Telecommunications System) numbers: VA
regional office and insurance center Philadelphia 486-5412 through 5416;
VA regional office and insurance\] center St. Paul-725-4311. These
numbers will reach the Special Service Insurance Personnel.

b\. The VSD employee will identify the VA office from which he or she is
calling and advise the insurance employee of the type of application
completed with all identifying and necessary information, such as
insurance file number, insured\'s name, address to which check is to be
mailed, amount of payment desired, etc. The insurance employee will be
asked to initiate the payment action promptly and advised that the
completed application will be mailed to the insurance office that same
day.

c\. The VSD employee will note, conspicuously, on the application
\"Confirmation of the telephone request of (date)\--For Record Purposes
Only.\" The application will then be mailed in an individual franked
envelope to the proper VA center, marked, \"Attention: Insurance Special
Service Unit\--DO NOT OPEN IN MAIL ROOM.

d\. This expedited payment procedure must be limited to cases in which
the insured spontaneously alleges an emergent situation and there is
positive identification of the insurance record and its location. If any
of these factors are missing, ordinary procedures should be followed.

**SUBCHAPTER V. WAIVER OF PREMIUMS AND TDIP (TOTAL DISABILITY**

**INCOME PROVISION) ASSISTANCE**

**11.17 WAIVER OF PREMIUMS**

a\. If the insured becomes totally disabled before his or her 65th
birthday and remains disabled for 6 consecutive months, payment of
premiums may be waived on the policy so long as the disability
continues. Total disability for insurance purposes is defined as any
impairment of mind or body which continuously makes it impossible for
the insured to follow any substantially gainful occupation. Certain
statutory disabilities (38 U.S.C. 714) are deemed to be totally
disabling without regard to employment.

b\. Waiver of premiums is not automatic. The insured, or a person acting
on his or her behalf, must file a claim, preferably on VA Form 29-357.
Total disability must begin before the insured\'s 65th birthday, after
the date of the insured\'s application for insurance, and while the
insurance is in force under premium-paying conditions. However, waiver
of premiums will not be denied when service-connected impairment
resulted in total disability prior to the effective date of RH
insurance.t

c\. All NSLI policyholders who meet the disability requirements are
eligible for waiver of premiums.

**11.18 TDIP (TOTAL DISABILITY INCOME PROVISION)**

All policies, except RH, provide for the addition of TDIP to the basic
policy. Application must be made for the provision before the insured\'s
55th birthday. TDIP provides a monthly income if the insured becomes
totally disabled for at least 6 consecutive months. The continuous total
disability must begin while the insurance and TDIP are in force and
before the age limitation specified in each provision.

**11-8**

**November 30, 1984 M27-1, Part I**

**Change 22**

**11.19 INSURANCE ASSISTANCE OUTREACH**

a\. A copy of the rating sheet establishing permanent and total
disability for pension purposes will be referred to VSD (M21-1, ch. 49,
par. 49.06a(2)(b)) to develop for insurance purposes.

b\. VSOs will arrange for outreach to those policyholders who may be
eligible for waiver of premiums or TDIP benefits. First, a check should
be made on the insurance status of those veterans who have been rated as
totally disabled for pension purposes by reference to BIRLS or the
Target System. Second, if active Government insurance is indicated, a
VBC will contact the insured, preferably by telephone, to explain the
waiver of premium and TDIP benefits and to assist the insured in making
application for the appropriate benefit(s).

**11-9**