Denied VGLI Life Insurance Claims

Veterans’ Group Life Insurance Claim Denials and Appeals

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 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. Our law firm represents beneficiaries nationwide in denied and delayed VGLI life insurance claims and appeals.

If your VGLI claim was denied or delayed, legal action may be required to recover the benefits.

What Makes VGLI Claims Different From Other Life Insurance

VGLI 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.

This distinction is critical. Federal regulations control eligibility, lapse, beneficiary rights, and appeals. Divorce decrees, state revocation statutes, and equitable arguments that might succeed under state law often have no effect on VGLI benefits.

Because courts typically defer to the administrative record, errors made during the appeal stage can permanently foreclose recovery.

Common Reasons VGLI Life Insurance Claims Are Denied

Lapse of Coverage Due to Nonpayment

The most common basis for a denied 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

The veteran was hospitalized, disabled, or otherwise incapacitated

In many cases, beneficiaries learn of the alleged lapse only after the insured’s death.

Failure to Convert SGLI to VGLI Within the Federal Deadline

One of the most frequent and 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 approval depends on medical underwriting.

VGLI claims are often denied where the veteran believed conversion was automatic, relied on incorrect guidance, submitted paperwork that was not 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, 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 and VA determinations.

Beneficiary Designation Problems

VGLI beneficiary disputes are governed by strict federal rules. The most recent valid beneficiary designation controls, 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

Fraud or undue influence is suspected

Many of these disputes result in interpleader lawsuits filed by the insurer.

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.

VGLI Beneficiary Disputes and Interpleader Lawsuits

When multiple parties claim entitlement to VGLI proceeds, the insurer may file an interpleader action in federal court and deposit the funds with the court.

Once an interpleader is filed, the insurer exits the case and beneficiaries must litigate against one another under strict procedural and evidentiary rules. These cases often turn on the validity of beneficiary designations, claims of incapacity, or allegations of fraud.

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 the case.

How We Help With Denied VGLI Claims

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

We assist with challenging lapse determinations, appealing missed conversion denials, resolving beneficiary disputes, litigating interpleader actions, and pursuing federal court review when appropriate.

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 FAQs

Does VGLI cover suicide?

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

Does VGLI ever expire?

VGLI 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 named as beneficiary on the most recent valid designation. Federal law controls beneficiary rights.

Can a denied VGLI claim be overturned?

Yes. Many denials are reversed on appeal when administrative or legal errors are properly addressed.

Free Case Evaluation Contact Us!

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: Dec 26, 2025 | Contact 800-330-2274