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Military Survivor Benefit Plan – Practical Tips for the Practitioner

by Mark Sullivan |

The Survivor Benefit Plan is the survivor annuity associated with military retired pay.  If the servicemember (SM) or retiree dies first, the spouse or former spouse (FS) survivor will receive 55% of the selected base amount (usually the full pension) for life.  The cost is 6.5% of the base amount for active-duty retirements, and about 10% for Guard/Reserve retirees.  When the parties are divorcing, this is an important part of the process, since former-spouse coverage can be provided at divorce through a court order.[1]  Here are the most important points to remember, regardless of which side you’re representing.

TIP #1.  Don’t Leave It Out.  If you’re representing the spouse/former spouse, make sure that you state that the SM or retiree must elect former spouse SBP coverage.  This is the only way to protect the flow of income which starts with the share of the pension.  While your client, Mary Doe, is living, you need to ensure that she receives her proper share of the military retired pay as marital property.  If her former husband, John Doe, dies before her, what happens to the pension?  It’s gone.  The pension payments stop when the pensioner dies.  Make sure you’ve insured the client for continued payments in the event of the untimely death of the military member or retiree.  If you don’t mention it, the SBP is lost.  Remember “LIFE and DEATH.”  Be sure to protect your client for both of these contingencies – a share of the pension during life, and SBP coverage upon the member’s death.[2]

TIP #2.  What’s the Deadline?  To effectuate coverage, you must comply with the deadlines imposed by federal law.  The military member or retiree, John Doe, needs to submit to the retired pay center[3] his election form within one year of the divorce.[4]  An election filed by the retiree is effective upon receipt by the retired pay center.[5]  The form to use for submissions to DFAS is DD Form 2656-1; John can get it by searching on the Internet for “2656-1” and it’s available in fillable PDF format.[6]   At the time of making this election, the applicant must provide a statement setting forth whether the election is being made pursuant to a court order.  If it is not, the statement must indicate whether it is pursuant to a written agreement previously entered into voluntarily by the retiree as part of, or incident to, a divorce proceeding (and, if so, whether such written agreement has been incorporated in, ratified, or approved by a court order).[7]  You need to mark that deadline on your “docket control system” and make sure you meet it.

TIP #3.  Watch Your Wording.  If you are representing Mary Doe, the former spouse, make sure that the language used in the SBP clause reflects a duty on the part of the SM or retiree to make the election.  Mary’s “deemed election” only applies if John has failed or refused to make the election for her.  If your wording is “Mary is entitled…” or “the government will provide…” you’ve missed the boat.  You need to write it up to impose an affirmative duty on John to make the former-spouse election for Mary.  Otherwise you cannot take advantage of the “belt and suspenders” protection for Mary which is provided by her “deemed election.”

TIP #4.  Spouse’s Suspense Date.  Just as John Doe has a deadline, described above at #2, Mary Doe (the FS beneficiary) has a suspense date for her SBP election.  The “deemed election” which she can file, in the event that her former husband fails or refuses to submit a court-ordered election for her, is one year from the entry of the order giving her FS coverage.[8]  Note that this may or may not be the same as the divorce date; sometimes the court bifurcates the issues, granting the divorce on one date and deciding on property distribution, pension division and the survivor annuity later on.  That deadline should also be a mandatory entry on your docket control system.  The form to use is DD Form 2656-10 for DFAS, the Defense Finance and Accounting Service.[9]

TIP #5.  Process Overview for Locking in SBP.  One way to think of the SBP-and-divorce process is to remember the letters R-R-R
R - means Requirement.  You need to get a court order to require the election of former-spouse SBP coverage.  The essential language is: “John Doe will elect immediately former-spouse SBP coverage for Mary Doe.”
R - stands for Request.  There must be an election of former-spouse coverage.  The election is made by the member or retiree.  John Doe must make this request by signing an SBP form selecting Mary Doe as his former-spouse beneficiary.  If he fails or refuses to make the election, then Mary Doe can make a deemed election, requesting SBP as if John had properly made the request.
R - means Register.  The election form, along with the court order or decree, must be served on the government (retired pay center or, with Guard/Reserve members, the appropriate headquarters as shown on the election form). 

TIP #6.  Who Pays the Tab?  If John Doe gets 60% of the pension, then he’ll pay 60% of the SBP premium, due to federal rules requiring that the FS premium is deducted “off the top,” (i.e., subtracted from John’s gross retired pay before the division of the pension).  This has the effect of splitting the SBP premium between John and Mary in the same ratio as their shares of the pension itself (e.g., 60% : 40%).  Federal law does not allow SBP costs to be apportioned between the parties.  You can, however, require one party to reimburse the other for the cost of coverage; in this situation, the retired pay center will not object, since it doesn’t involve changing federal rules.  In fact, you can actually shift the premium to the FS by reducing Mary’s nominal share of the pension, and the retired pay center will honor the order.  The reduction is fully explained in the SILENT PARTNER infoletter, “Military Pension Division: The Servicemember’s Strategy,” at www.nclamp.gov > For Lawyers > Silent Partner. The SILENT PARTNER series is published by the military committee of the North Carolina State Bar.

TIP #7.  Your EX or Your NEXT.  SBP cannot be subdivided.  It’s either the property of one’s former spouse or one’s current spouse.  Take your pick.  You can’t apportion it between the two; SBP is a unitary benefit.

TIP #8.  Mirror Award.  Don’t even go there.  There are virtually unsurmountable problems associated with the creation of an SBP amount at John’s death which mirrors Mary’s pension award during his life.  If you happen to get the divorce case when John is just about to retire from active duty, then you might be able to crank the numbers and make it work.  Otherwise, leave it alone.  No one can work the numbers during active duty which will predict what John’s retired pay will be, based on a marital fraction which is unknown, and based on military pay table on which Congress hasn’t voted yet.

TIP #9.  Age 55 and Remarriage.  Speaking of one’s NEXT, what if Mary Doe has plans for remarriage?  Be sure to remind the former spouse about the “remarriage penalty.”  This refers to the rule that if she remarries before she turns 55, SBP coverage is suspended.  Coverage can be reinstated, however, if that remarriage ends in divorce, death or annulment.

TIP #10.  “The Rework Shop.”  Often the parties to a divorce do not know that there’s a one-year deadline within which to register the FS election for SBP.  When the deadlines have been missed, sometimes the BCMR (Board for the Correction of Military Records) for John’s branch of service (e.g., Coast Guard, Air Force) can remedy the problem.  The request must be made within three years of the error (that is, the entry of a divorce or pension division order without follow-up in serving the election), or discovery of the error.[10]  Use DD Form 149 for the petition, and read the service regulations to find out the procedures and requirements.  If you’re new to this, associate co-counsel who has experience with BCMR applications.

TIP #11.  Remarriage Redux.  What if John Doe, the servicemember or retiree, remarries?  DD 2656-6, the change of beneficiary form, is required to effect coverage for John’s current wife.  If the death of John is less than one year from the date of marriage, the new wife will receive a refund of the premium payments.  If it is longer, then she will be qualified as his surviving spouse for SBP purposes, and she will receive 55% of the selected base amount for the rest of her life, unless she remarries before age 55 (see #8 above).

TIP #12.  Put a Price Tag on It.  When Mary Doe has rejected every settlement option and she still demands SBP coverage, John's strategy starts with valuation of the asset.[11]  Most states require the valuation of all assets acquired during the marriage.  Get an expert witness to "price the SBP" so that Mary Doe is charged with that value.[12]  If Mary is faced with the cost of this benefit, which may be $50,000, $100,000 or even more, she may need to rethink that simple approach of "I demand it."  She will have to start thinking about a new issue: "If you want to buy it, then you'll be charged with the price on the tag" for the present value.  In other words, "There's no such thing as a free lunch."[13]  Failure to value the SBP can be a fatal flaw.  Some courts have held that failure to value a marital asset means that the asset cannot be divided.[14]  The burden to establish a value is on the party who wants to include the asset in the marital estate for division by the court.

[1] 10 U.S.C. § 1448(b)(3)(A)(i).

[2] In Williams v. Williams, 37 So.3d 1171 (Miss. Ct. App. 2010), an agreement stating that the wife was to have “all survivors’ benefits otherwise accorded to her by law…” did not mean, according to the appellate court, that she was entitled to Survivor Benefit Plan coverage, since SBP is a personal choice, and it is not mandated by law.  The chancellor erred in requiring SBP coverage for wife since the agreement of the parties did not entitle wife to coverage.  In Creech v. Creech, 2010 Ky. App. Unpub. LEXIS 194, 2010 WL 743748, the parties had agreed to the wife getting 50% of the marital share of pension. The agreement was not reduced to writing but was dictated into the record.  The wife filed a motion later to get SBP, the judge denied her motion and the Court of Appeals upheld the judge’s order, stating that the wife cannot get what she failed to mention in her settlement.  In Morris v. Morris, 804 N.W.2d 314 (Iowa Ct. App. 2011), the appellate court found that “half of husband’s military retirement” doesn’t mean SBP coverage; in this case, the husband provided life insurance of $350,000 in the settlement, which didn’t mention SBP.  The ex-wife also lost out in Kuba v. Kuba, 400 S.W.3d 869 (Mo. Ct. App. 2013), a case involving a 2008 divorce decree, followed three years later by a motion made by the former spouse to include the Survivor Benefit Plan in an order dividing military retired pay which had already been submitted in 2008 to DFAS.  The trial court denied relief to her, and the appellate court affirmed that decision.

[3] For the Army, Navy, Air Force and Marine Corps, the retired pay center is DFAS (Defense Finance and Accounting Service) in Cleveland, Ohio.  Pension garnishments for the Coast Guard and the commissioned corps of the Public Health Service (PHS) and of the National Oceanic and Atmospheric Administration (NOAA) are handled by the Coast Guard Pay and Personnel Center in Topeka, Kansas.

[4] 10 U.S.C. § 1448(b)(3)(A)(iii).

[5] 10 U.S.C. § 1448(b)(3)(E).

[6] The form to submit to the Coast Guard Pay and Personnel Center is CG PSC-4700.  When the SM is in the National Guard or Reserves, the address to use (not DFAS) will be found on the form.

[7] 10 U.S.C. § 1448(b)(5).

[8] 10 U.S.C. § 1450(f)(3)(C).

[9] This for may also be used for a deemed election when the branch of uniformed service is Coast Guard, PHS or NOAA.

[10] If the member/retiree has remarried, the new spouse must either execute a waiver of SBP coverage or else be joined in the lawsuit so that the court can enter a ruling barring any claim of the new spouse to SBP.  See Ellison v. Ellison, 242 N.C. App. 386, 776 S.E.2d 522 (2015) as to the court’s jurisdiction to enter summary judgment against the widow of deceased retiree as to SBP which was previously awarded to former spouse, who failed to make a timely deemed election with DFAS and had previously been turned down by the Army Board for Correction of Military Records because the competing claim of the widow had not been adjudicated in a court proceeding in which both women were parties.

[11]  IRMO Lipkin, 566 N.E. 972 (Ill. App. ’91) (survivor annuity is a distinct property interest within the pension plan, it needs to be distributed at divorce; it has a determinable value, computed by using life expectancy tables).

[12]  Burt v. Burt, 799 P. 2d 1166 (Utah App. 1990) (court may fix value of government survivor annuity and consider that sum in distribution scheme).

[13]  See, e.g., In re Marriage of Forney, Ore. App. 405, 244 P. 2d 849 (2010) (court ruled that the Survivor Benefit Plan, even though earned by pre-marriage service, had to be valued; the trial judge had disregarded a value placed on it of $84,000 by the husband’s expert).

[14]  See, e.g., Grasty v. Grasty, 125 N.C. App. 736, 482 S.E.2d 752 (1997), disc. rev. den. 487 S.E.2d 545, 346 N.C. 278 (1997), and Johnson v. Johnson, 230 N.C. App. 280, 750 S.E.2d 25 (N.C. App. 2013).

About the Author

Mark Sullivan

mark.sullivan@ncfamilylaw.com | 919.832.8507


Mr. Sullivan is a retired Army Reserve JAG colonel.  He practices family law in Raleigh, North Carolina and is the author of The Military Divorce Handbook (Am. Bar Assn., 3rd Ed. 2019) and many internet resources on military family law issues.  A Fellow of the American Academy of Matrimonial Lawyers, Mr. Sullivan has been a board-certified specialist in family law since 1989.  He works with attorneys and judges nationwide on military divorce issues and in drafting military pension division orders.

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