[Federal Register Volume 77, Number 212 (Thursday, November 1, 2012)]
[Rules and Regulations]
[Pages 66069-66071]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-26580]



38 CFR Part 9

RIN 2900-AO24

Veterans' Group Life Insurance (VGLI) No-Health Period Extension

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.


SUMMARY: The Department of Veterans Affairs (VA) is issuing this final 
rule that amends the regulations governing eligibility for Veterans' 
Group Life Insurance (VGLI) to extend to 240 days the current 120-day 
``no-health'' period during which veterans can apply for VGLI without 
proving that they are in good health for insurance purposes. The 
purpose of this rule is to increase the opportunities for disabled 
veterans to enroll in VGLI, some of whom would

[[Page 66070]]

not qualify for VGLI coverage under existing provisions. This document 
adopts as a final rule, without change, the proposed rule published in 
the Federal Register on June 25, 2012.

DATES: Effective Date: This rule is effective November 1, 2012.
    Applicability Date: VA will apply this rule to veterans released 
from service on or after November 1, 2012.

FOR FURTHER INFORMATION CONTACT: Monica Keitt, Attorney/Advisor, 
Department of Veterans Affairs Regional Office and Insurance Center 
(310/290B), 5000 Wissahickon Avenue, P.O. Box 8079, Philadelphia, PA 
19101, (215) 842-2000, ext. 2905. (This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: On June 25, 2012, VA published in the 
Federal Register (77 FR 37839) a proposed rule that would amend 38 CFR 
9.2(c) to extend the period during which no evidence of insurability is 
needed, known as the Veterans' Group Life Insurance (VGLI) ``no-
health'' period, from 120 days to 240 days. This amendment is designed 
to increase the number of veterans who will qualify for VGLI, 
particularly disabled veterans who may not qualify for private life 
insurance due to their disabilities.
    In addition, VA proposed to remove from Sec.  9.2(c) the words 
``Servicemembers' Group Life Insurance (SGLI) or,'' which refer to 
Retired Reservist SGLI, which was discontinued by Public Law 104-275 as 
an independent program on October 9, 1996, when the program was merged 
into the VGLI program. As a result, reference to SGLI in Sec.  9.2(c) 
is no longer applicable. VA also proposed to amend Sec.  9.2 by 
revising the authority citation following Sec.  9.2(b)(4) to read 
``(Authority: 38 U.S.C. 1977)'' instead of ``(Authority: 38 U.S.C. 
1977(e))'' to reflect the proper legal authority for Sec.  9.2.
    VA provided a 30-day comment period for the proposed rule that 
ended on July 25, 2012. We received two comments. One commenter stated 
that he supports the proposed rule because it would ``greatly benefit'' 
veterans, especially those with service-connected disabilities. Another 
commenter stated she agreed that the proposed VGLI ``no-health'' period 
extension was a good idea, noting her own experience with the ``no-
health'' period. VA appreciates the fact that both commenters support 
the proposed rule.
    Based on the rationale set forth in the proposed rule, we adopt the 
proposed rule without change as the final rule.

Administrative Procedure Act

    The Secretary has determined that there is good cause to dispense 
with the 30-day delayed effective date and publish this rule with an 
effective date as the date of publication. This rule will increase the 
opportunity for veterans to obtain valuable insurance coverage that is 
needed to help ensure financial security for their families, while 
placing no additional burdens on veterans or their families. VA 
believes that implementation of this regulation is particularly urgent 
because, by extending the VGLI no-health eligibility period, VA will 
enable some of the most disabled veterans, who would not be eligible 
for private insurance due to their disabilities, to obtain insurance 
coverage. The immediate effective date will not result in any 
additional cost or negative impacts on the program, but will make the 
extended no-health period available to disabled veterans sooner.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in an expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any year. This final rule will have no such effect on 
State, local, and tribal governments or on the private sector.

Paperwork Reduction Act

    This final rule contains no provisions constituting a collection of 
information under the Paperwork Reduction Act (44 U.S.C. 3501-3521).

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess the 
costs and benefits of available regulatory alternatives and, when 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, and other advantages; distributive impacts; 
and equity). Executive Order 13563 (Improving Regulation and Regulatory 
Review) emphasizes the importance of quantifying both costs and 
benefits, reducing costs, harmonizing rules, and promoting flexibility. 
Executive Order 12866 (Regulatory Planning and Review) defines a 
``significant regulatory action,'' which requires review by the Office 
of Management and Budget (OMB), as ``any regulatory action that is 
likely to result in a rule that may: (1) Have an annual effect on the 
economy of $100 million or more or adversely affect in a material way 
the economy, a sector of the economy, productivity, competition, jobs, 
the environment, public health or safety, or State, local, or tribal 
governments or communities; (2) Create a serious inconsistency or 
otherwise interfere with an action taken or planned by another agency; 
(3) Materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
this Executive Order.''
    The economic, interagency, budgetary, legal, and policy 
implications of this regulatory action have been examined, and it has 
been determined not to be a significant regulatory action under 
Executive Order 12866.

Regulatory Flexibility Act

    The Secretary of Veterans Affairs hereby certifies that this final 
rule will not have a significant economic impact on a substantial 
number of small entities as they are defined in the Regulatory 
Flexibility Act, 5 U.S.C. 601 et seq. This final rule will directly 
affect only individuals and will not directly affect any small 
entities. Therefore, pursuant to 5 U.S.C. 605(b), this final rule is 
exempt from the initial and final regulatory flexibility analysis 
requirements of sections 603 and 604.

Catalog of Federal Domestic Assistance Number and Title

    The Catalog of Federal Domestic Assistance number and title for the 
program affected by this document is 64.103, Life Insurance for 

Signing Authority

    The Secretary of Veterans Affairs, or designee, approved this 
document and authorized the undersigned to sign and submit the document 
to the Office of the Federal Register for publication electronically as 
an official document of the Department of Veterans Affairs. John R. 
Gingrich, Chief of Staff, Department of Veterans Affairs, approved this 
document on September 28, 2012, for publication.

List of Subjects in 38 CFR Part 9

    Life insurance, Military personnel, Veterans.

[[Page 66071]]

    Dated: October 24, 2012.
William F. Russo,
Deputy Director, Office of Regulation Policy and Management, Office of 
the General Counsel, Department of Veterans Affairs.

    For the reasons stated in the preamble, the Department of Veterans 
Affairs amends 38 CFR part 9 as follows:


1. The authority citation for part 9 continues to read as follows:

    Authority:  38 U.S.C. 501, 1965-1980A, unless otherwise noted.

2. Amend Sec.  9.2 by:
a. Revising the authority citation at the end of paragraph (b).
b. Revising paragraph (c).
c. Adding an authority citation at the end of the section.
    The revisions and addition read as follows:

Sec.  9.2  Effective date; applications.

* * * * *
    (b) * * *

(Authority: 38 U.S.C. 1977)

    (c) If either an application or the initial premium has not been 
received by the administrative office within the time limits set forth 
above, Veterans' Group Life Insurance coverage may still be granted if 
an application, the initial premium, and evidence of insurability are 
received by the administrative office within 1 year and 120 days 
following termination of duty, except that evidence of insurability is 
not required during the initial 240 days following termination of duty.
* * * * *

(Authority: 38 U.S.C. 501, 1967, 1968, 1977)

[FR Doc. 2012-26580 Filed 10-31-12; 8:45 am]