Since child support and maintenance payments stop when the obligor dies, family law courts frequently order obligors  to carry term life insurance to protect his/her survivors in the event of death.  Term life insurance is where a person pays a premium for a time frame, and if he/she dies during that coverage period, the benefit is paid.  If payments lapse, so does the policy, and, the policy has no surrender value.

Some employers offer inexpensive term life policies, and the military is no exception.

Under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), Tricare will provide a divorced civilian spouse with 36 months of health insurance. They call it the Continued Health Care Benefit Program. At $933 per quarter for individuals, and $1996 for families, the program is far from free, and certainly not the bargain Tricare is.  However, if the civilian spouse has a preexisting medical condition, it could be worthwhile.

A former spouse who was married to the servicemember for at least 20 years qualifies for military benefits after the dissolution, under the conditions listed below.

Coverage for a former spouse is suspended if he/she remarries while under 55, during the period of the remarriage. The premiums are also suspended, effective the first day of the month after remarriage, as long as DFAS is provided with written notification and a copy of the former spouse's marriage certificate.

Election by Servicemember

Prior to retirement, a servicemember is required to complete a DD Form 2656, Data for Payment of Retired Personnel, which also includes the Survivor Benefit Plan election.  If married, the servicemember is required to obtain his/her spouse's notarized signature to elect less than full coverage.  If divorced, the form has a place to select former spouse coverage, but the former spouse's signature is not required for this form.

DFAS deducts the SBP premiums directly from the retired pay, prior to distribution. This has two consequences: (1) the premium is paid with pretax money, which reduces the SBP costs, and (2) absent a reimbursement mechanism, the parties are effectively splitting the SBP costs in accordance with the percentage of retirement each receives.

Spouse & Former Spouse Coverage

Retired servicemembers pay a monthly premium for SBP coverage.  The federal government subsidizes part of the program costs (theoretically 40%), and premiums are deducted from the military retirement before disbursal, so are not taxable.

The normal premium for participants is 6.5% of the designated base amount for a surviving spouse or former spouse.

Servicemembers who are retiring for disability, or who entered active duty before 2/28/1990, have another option for the SBP premium. They can utilize the lesser of the 6.5% formula, or 2.5% of the threshold amount ($675 as of January 1, 2008), plus 10% of the remainder of the designated base amount.  The threshold amount increases annually with the active duty COLA.

Example: assuming a designated base amount of $1600, the premium cost under each method would be:

Spouse / Former Spouse Coverage

Pursuant to 10 U.S.C. §1447(7), a retiree may elect his/her spouse or former spouse as beneficiary, as long as they::

• Were married at the time the servicemember became eligible for retired pay,
• Were married at least one year at the time of the retiree's death, or
• Had a child together.

Think of the Survivor Benefit Plan (SBP) as an insurance policy, focused on protecting a survivor's income flow from the military retirement if the retiree dies first.  It has a premium, and a payout in the form of a monthly payment from DFAS.

Without SBP, if the retiree dies, the military retirement stops as well.  However, to protect a surviving former spouse's share of military retirement after a Colorado divorce or legal separation, family courts can require a servicemember to elect former spouse SBP coverage.