Denied VGLI Life Insurance Claims

Christian Lassen, Esq. | Quoted in The Wall Street Journal | 25 Years Experience

When a Veterans’ Group Life Insurance claim is denied, families are often blindsided. VGLI is intended to provide long term financial protection for veterans and their beneficiaries, yet claims are frequently denied after death based on technical federal rules, administrative errors, or alleged lapses in coverage.

A denied VGLI claim is not necessarily final. Many denials are incorrect, incomplete, or legally challengeable under federal law. At Lassen Law Firm, we represent beneficiaries nationwide in denied and delayed VGLI life insurance claims and appeals. When a claim is denied or stalled, legal action is often required to recover the benefits.

What Makes VGLI Claims Different From Other Life Insurance

Veterans’ Group Life Insurance is a federal life insurance program governed by Title 38 of the United States Code. State insurance law does not apply, and ERISA does not apply. Federal statutes and regulations control eligibility, lapse, beneficiary rights, and appeals.

This distinction is critical. Divorce decrees, state revocation statutes, and equitable arguments that might succeed under state law often have no effect on VGLI benefits. Courts typically limit review to the administrative record, which means mistakes made during the appeal process can permanently foreclose recovery.

Common Reasons VGLI Life Insurance Claims Are Denied

Alleged Lapse of Coverage Due to Nonpayment

The most common basis for denying a VGLI claim is an alleged lapse for missed premiums. VGLI coverage remains in force only if premiums are paid on time or within the grace period.

Denials frequently occur when premium notices were never received, address changes were not processed, automatic payments failed without notice, or the veteran was hospitalized, disabled, or otherwise incapacitated. In many cases, beneficiaries learn of the alleged lapse only after the veteran’s death.

Many lapse based denials can be challenged when notice failures, grace period violations, or administrative errors are identified.

Failure to Convert SGLI to VGLI Within Federal Deadlines

One of the most misunderstood grounds for denial involves failure to convert SGLI coverage after separation from service.

Federal law generally provides one year and 120 days from separation to convert SGLI to VGLI. The first 240 days do not require proof of insurability. After that period, conversion may still be possible but is subject to medical underwriting.

VGLI claims are often denied where the veteran believed conversion was automatic, relied on incorrect guidance, submitted paperwork that was never processed, or received confirmation of coverage that was later disputed. When VGLI coverage was issued or premiums were accepted, a post death denial based on timing may be legally challengeable.

Alleged Ineligibility for VGLI Coverage

Some claims are denied based on assertions that the veteran was never eligible for VGLI coverage, even where coverage was issued and premiums were paid.

Eligibility disputes often involve separation status, Reserve or National Guard classifications, or disability related eligibility questions. These cases require careful review of military records, VA determinations, and coverage history.

Beneficiary Designation Problems

VGLI beneficiary rights are governed by strict federal rules. The most recent valid beneficiary designation controls payment, regardless of marital status, divorce, or family relationships.

Claims may be denied or delayed when beneficiary forms are missing or outdated, multiple individuals submit competing claims, a beneficiary change is alleged to be invalid, or fraud or undue influence is suspected. Many of these disputes result in interpleader lawsuits filed in federal court.

Delayed VGLI Claims and Administrative Stalling

Some VGLI claims are not formally denied but remain unpaid for extended periods. Common causes of delay include repeated document requests, prolonged review of military or medical records, unresolved beneficiary disputes, and administrative backlogs.

Delays can be financially devastating for families relying on life insurance proceeds for burial costs and living expenses. Prolonged delay may itself be legally actionable.

Appeals of Denied VGLI Claims

A denied VGLI claim must usually be appealed through the administrative process before court review is available. Successful appeals depend on identifying procedural errors, correcting defects in the administrative record, and submitting evidence that was overlooked or misinterpreted.

Because judicial review is limited, the appeal stage is often the most important phase of a VGLI case. Errors made during an appeal are difficult or impossible to correct later.

How We Help With Denied VGLI Claims

Our firm focuses exclusively on life insurance disputes, including federal group life insurance programs. We represent beneficiaries nationwide in denied and delayed VGLI claims.

Our work includes challenging lapse determinations, appealing missed conversion denials, resolving beneficiary disputes, litigating interpleader actions, and pursuing federal court review when appropriate. Each case is handled with a detailed review of federal law, military records, and administrative procedures.

Contingency Fee Representation

Denied VGLI claims are handled on a contingency fee basis. You do not pay legal fees unless benefits are recovered.

Denied VGLI Claim Questions and Answers

Does VGLI cover death by suicide

Yes. VGLI does not contain a suicide exclusion and generally covers death by suicide.

Does VGLI ever expire

VGLI coverage does not expire as long as premiums are paid. Coverage lapses only if premiums are missed beyond the grace period.

Can a divorced spouse receive VGLI benefits

Yes. If a divorced spouse is named as beneficiary on the most recent valid designation, federal law controls and the designation governs payment.

Can a denied VGLI claim be overturned

Yes. Many VGLI denials are reversed on appeal when administrative errors, notice failures, or misapplication of federal law are properly addressed

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Written & Reviewed by Christian Lassen, Esq., Nationally recognized life insurance lawyer: 25 years experience, hundreds of millions recovered.  Quoted in The Wall Street Journal ( May 17, 2025).

Last reviewed: Jan 3, 2026 | Contact 800-330-2274