Military death benefits may rise


Published: Tuesday, February 1, 2005 at 6:01 a.m.
Last Modified: Tuesday, February 1, 2005 at 12:48 a.m.

WASHINGTON - President Bush will propose a dramatic increase to $250,000 in government payments to families of U.S. troops killed in the Iraq and Afghanistan wars and in future combat zones.

The plan to increase the tax-free "death gratuity," now $12,420, to $100,000 and provide an extra $150,000 in life insurance payouts will be part the 2006 budget proposal submitted to Congress next week, the Pentagon's personnel chief said in an Associated Press interview. Veterans groups and many in Congress have been pushing for such increases.

"We think the nation ought to make a larger one-time payment, quite apart from insurance, should you be killed in a combat area of operations," David Chu, the undersecretary of defense for personnel and readiness, said in the interview in his Pentagon office.

"We can never in any program give someone back their loved one," he added. "There is nothing we can do about the hurt, to make it go away. But we can make your circumstances reasonable, in terms of finances."

Chu is to unveil the administration's full proposal in congressional testimony Tuesday.

Sen. Jeff Sessions, R-Ala., who is sponsoring a bill with the same provisions, said in an interview that the first-year budget cost of the increased benefits would be $459 million, including more than $280 million in retroactive payments of the higher gratuity and the extra life insurance settlements.

"The American people want to be generous to the families of service people who give their lives for their country. It's not a nickel-and-dime issue," he said.

In addition to the higher gratuity, the Pentagon would substantially increase life insurance benefits, Chu said. The current $250,000 coverage offered to all service members at a subsidized rate under the Servicemen's Group Life Insurance program would be raised to $400,000, and for troops in a combat zone the government would pay the premiums on the extra $150,000 coverage.

Even in the case of a service member who did not participate in the basic life insurance program, the surviving spouse would receive a $150,000 settlement if the death happened in a designated combat zone, since the Pentagon is proposing to pay the premiums on that amount of coverage for everyone in a war zone. The spouse or other surviving family member also would get the $100,000 gratuity.

Chu said that the extra $150,000 in life insurance and the higher death gratuity would be retroactive to Oct. 7, 2001, the date the United States launched its invasion of Afghanistan in response to the Sept. 11 terrorist attacks.

Some bills in Congress would make the higher gratuity retroactive but not the extra life insurance.

Under the administration's proposal, the 53 military members who were killed in the Sept. 11 attack on the Pentagon would not get the higher gratuity, a spokeswoman said.

As of Monday, 1,415 Americans had died in the Iraq war, according to the Pentagon, and 156 had died in Afghanistan and other locations deemed part of the war on terrorism.

The death gratuity is a one-time payment intended to be given to the family immediately after a service member's death; it is separate from an array of other survivor benefits such as housing aid.

The $100,000 would apply only in cases where the service member died in a war zone as designated by the secretary of defense. Thus a soldier killed in a training accident in the United States would get the current $12,420, Chu said. Some in Congress have proposed paying an increased gratuity for all deaths.

In the aftermath of the Sept. 11 attacks, defense officials decided that the current death payment for troops killed in battle was too little, particularly in light of settlements paid to Sept. 11 families. The government paid an average $2.1 million to the families of those killed in those attacks.

In 2003 the military gratuity was doubled, from $6,000, where it had stood since 1991, to $12,000, with subsequent increases to account for inflation, bringing it to $12,420 on Jan. 1, 2005. The 2003 legislation also made the payment fully tax-free. Before that, half was taxable.

Lawmakers in both the House and Senate have introduced bills to raise both the gratuity and the life insurance coverage, reflecting a broader trend of more generous military benefit programs, including financial benefits for military retirees, their survivors and families of those killed in battle.

These changes are adding billions to defense budgets and raising questions about whether increasingly costly entitlements are forcing the Pentagon to forgo some investments in weapons programs.

Chu said he was concerned that in recent years Congress had gone too far in expanding military retiree benefits, but he said the proposed increase in survivor benefits was well justified.

Bigger military benefits that apply mainly to retirees and their families are making it harder for the Pentagon to afford financial incentives targeted at maintaining today's military, Chu said.

"They are starting to crowd out two things: first, our ability to reward the person who is bearing the burden right now in Iraq or Afghanistan," Chu said. "(Second), we are undercutting our ability to finance the new gear that is going to make that military person successful five, ten, 15 years from now."

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