The Official Voice of Vietnam Veterans of America, Inc. ®
An organization chartered by the U.S. Congress
March/April 2006
FEATURE
 
 

SBP vs. DIC
Benefits Conflict For Survivors Of Deceased Veterans
 

 

Several programs exist to aid the survivors of deceased veterans. In certain situations, these programs may interact with each other, preventing a full and appropriate financial recovery by the survivors. An example of this type of interaction is the application and administration of the Survivor Benefit Plan (SBP) and Dependency and Indemnity Compensation (DIC).

The SBP was established by Congress and became effective September 21, 1972. SBP is a Department of Defense program that, under certain circumstances, provides for a monthly income to survivors of retired military personnel upon the death of a service member whose retired pay ceases the date of death. Survivors of members who die while on active duty and survivors of those recalled to active duty from retirement who die while on active duty also may be protected by the SBP.

Initially, a service member had to have served at least 20 years’ active duty for his or her survivors to be eligible. After 9/11, Congress extended SBP eligibility to survivors of all service members who die in the line of duty.

SBP coverage is automatic for all active-duty members, including Reservists and National Guardsmen serving on active duty who have eligible beneficiaries. This is a gratuitous benefit: It does not cost the active-duty member anything. For the SBP to become effective, the service member’s death must have taken place in the line of duty for an annuity to be payable if the member is not yet eligible for retirement at the time of death.

DIC is a separate program administered by the VA. DIC provides a monthly payment to eligible survivors of a deceased veteran whose death resulted from a service-related illness or injury. If the veteran’s death was not service-related, eligibility may exist if one of two conditions existed at the time of death: First, if the veteran was receiving VA disability compensation for a total disability for the 10 years prior to his or her death; second, if the veteran was receiving VA disability since release from active duty and for at least five years.

These two programs collide when a surviving spouse is eligible to receive both SBP and DIC. In such an instance, the spouse’s SBP annuity payment is reduced by the amount of the DIC award. This offset prevents the survivor from fully realizing the benefit of the two programs.

This is what VVA finds objectionable: Giving with one hand while ripping badly needed income from the hands of widows with the other. VVA remembers the VA’s motto— “To care for him who hath borne the battle, and his widow and orphans”—even if others need to be reminded that this is the essence of our collective mission. 

Like the “Disabled Veterans Tax”—more commonly known as concurrent receipt—the offset is unfair to survivors, who are penalized because the death of a spouse has made them eligible to receive both benefits.

“The fair thing to do—the right thing to do—is to repeal the law that deducts DIC payments from SBP annuities,” said VVA National President John Rowan. 

But in a Congress faced with the imperative to reduce discretionary spending to help control the burgeoning national deficit, this is unlikely to happen any time soon. 

   

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