If your ex-spouse is a member of the United States Military, you may have a marital interest in his/her retirement pay. When a military retiree dies, his/her retirement pay stops. Importantly, any payments to a surviving former spouse also stop. A Survivor Benefit Plan (SBP) helps protect a former spouse from losing this income source. In short, the SBP is an insurance plan that will pay the surviving former spouse a monthly payment (annuity) to help make up for the loss of retirement income.
How do I Elect Former Spouse SBP Coverage?
After a divorce, the military spouse may make a former spouse SBP election whether or not there is a provision your divorce decree requiring him/her to do so. This former spouse election must be made within one (1) year of the date of divorce.
If the divorce decree requires former spouse SBP coverage, you may submit a “deemed election” request to Defense Finance and Accounting Service (DFAS) within the one (1) year period asking that an election of SBP coverage be made on your behalf. This helps guarantee that your ex-spouse will comply with the Court Order or agreement.
What is the Cost to Elect Former Spouse SBP Coverage?
The SBP cost will depend on the level of coverage you choose. The minimum amount that coverage can be based on is $300. The maximum amount of coverage is full retired pay. If the SBP is based on full retired pay, the surviving spouse will receive approximately 55% of the gross retired pay upon the death of the military spouse and each month thereafter.
There is no cost for SBP coverage during active service. During retirement, a monthly deduction is taken from the retirement pay to pay for the SBP coverage.
Premiums for former spouse coverage are calculated in the same way as premiums for spouse coverage. The premium can be no more than 6.5% of the total gross retired pay for former spouse coverage.