Special Report

Hero Insurance

There is a better way to provide death benefits to the survivors of American soldiers killed in action.

By 2.2.05

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"I don't get no respect," bemoaned the late Rodney Dangerfield. "I asked my dentist what to do about my yellow teeth. He said maybe I should wear a brown tie." This is a fair approximation of the workings of modern government. A problem program is never eliminated or fixed, it simply spawns a new entity whose ostensible purpose is to ameliorate the aftertaste of the old.

Competing versions of a bill to enhance military death benefits are presently being debated in Congress. The idea is to expand existing benefits somewhat but also to create a large lump sum subsidy of as much as a quarter of a million dollars. The problem lies not in the idea of helping bereaved families with greater dollar amounts but in creating this separate bestowal rather than sensibly modifying the current insurance system.

As of right now, here is how it works. When a soldier dies in the course of his or her service, the next of kin receive a sum of between twelve and thirteen thousand dollars, absurdly named a "gratuity," designed to cover the expenses of funeral, burial, and attendant dislocations. Additionally, the widow and orphans receive a monthly "indemnification" check, a sort of pension, of about a thousand dollars, similar to a Social Security payment. This continues as long as the widow lives.

To provide a larger nest egg for his family, a soldier must buy SGLI, Soldier Group Life Insurance. This is done by having an amount of approximately $15 withheld from his salary each month to be paid as a life-insurance premium, guaranteeing his family a quarter-million dollar payout in the event of his demise while serving. The problem is that since soldiers are paid inadequate salaries and commonly are stationed away from families, leaving their spouses with limited flexibility for working outside the home, it is often very difficult to sacrifice the liquidity of that monthly premium.

The old joke went like this: the Army hires people to try to sell the recruits on buying the life insurance policies and offers a hundred dollars for each sale, yet very few soldiers are biting. Schwartz approaches the Captain and asks if he can be given the job of selling the policies in his spare time, because he needs the extra cash. The Captain doubts that an active soldier can sell much in the scant minutes that are free during training camp, but he has nothing to lose by agreeing. So Schwartz gets the job.

Suddenly, everyone is signing up to purchase the insurance. The Captain delivers the huge commission check to Schwartz but he can't hold back from asking for the secret of his success.

"Simple," answers Schwartz. "I tell them that an uninsured person costs the Army ten thousand dollars if he dies but an insured costs a quarter-million. Who do you think they would rather send to the front?"

The point should be well-taken. An insurance pool is the correct system for dealing with loss of life in a military group no less than it is in the civilian. But the idea of confronting the individual soldier with the choice of taking less today to mitigate the aftershock of his mortality is too great a strain to place on struggling providers. Sure, there is a place in my libertarian heart that would prefer that citizens have these options, but that principle has long since been nullified by the mandatory Social Security tax. Why should the fighting man and woman be the only American still forced to face these grim choices?

There is no need to create new gifts for grieving families. Everything should be subsumed under the heading of insurance, but the withholding of premiums needs to be built into the paycheck of every soldier and sailor. To raise the amount of coverage is a great idea, but the premium amount needs to rise in actuarial accordance. Nor do we need to shrink anyone's salary at this time. Let the present pay scale become the baseline, let salaries be raised by the amount of the premium, and henceforward we will have insurance that makes sense and that covers all personnel equally.

That way, people have a sense of earning their keep and providing for their family. The insurance money is kept in a separate pool and paid out like any other legitimate coverage. The family remembers their loved one as someone who saw to it that they were substantially cared for even after he or she was gone. And the government is where it belongs: far in the background.

As for what Schwartz will do for a living, now that Rodney is gone he may be considering a little stand-up.

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About the Author

Jay D. Homnick, commentator and humorist, is a frequent contributor to The American Spectator.