2. The applicant requests correction of his military records by canceling person with insurable interest (daughter) beneficiary and by changing the date of his
RC-SBP (Reserve Component Survivor Benefit Plan) participation from 16 July 1984 to 11 January 1987 with the beneficiary being his current spouse.
3. The applicants military records show that he was born on 1 January 1934. He was a member of the Army National Guard. He was married with children. On 12 August 1979, the U.S. Army Reserve Personnel Center (ARPERCEN) sent a packet of notification of eligibility for retired pay at age 60 and the RC-SBP. The applicant elected RC-SBP for spouse, full retired pay, option C. On 6 June 1984,
the marriage ended in divorce and RC-SBP coverage was suspended. On 16 July 1984, the applicant elected another SBP option person with unsurable interest (daughter). This election is not allowable by law since the member was participating with suspended spousal coverage. However, the Defense Finance and Accounting Service (DFAS) erroneously processed the election form. On 28 November 1986, the applicant remarried and shortly thereafter, he elected RC-SBP for his current spouse. On 28 November 1987, on the first anniversary of his remarriage, spousal coverage for RC-SBP became effective for his current spouse. The applicant was placed on the retired list on 15 April 1995 and since that time premiums for person with insurable interest (daughter) and spouse coverage has been deducted from his retired pay.
4. The applicant discovered the error and on 23 June 1995, submitted an appeal to this Board.
5. Public Law 92-425, the SBP, enacted 21 September 1972, provided that military members on active duty could elect to have their retired pay reduced to provide for an annuity after death to surviving dependents. However, surviving children are only entitled to SBP payments until reaching age 22 in certain cases. Changes in SBP options are not authorized except in specific instances, or authorized by law.
6. Public Law 95-397, effective 1 October 1978, extended eligibility for coverage under the SBP to members and former members of the Reserve Components (RC) who had 20 or more years of qualifying service, but had not reached age 60, the age at which they would be eligible for retired pay.
7. In the processing of this case, a staff advisory opinion was obtained from the Headquarters Army Retirement Services, in ODCSPER, which recommended approval of the applicants request for RC-SBP be changed from person with insurable interest-daughter, to spouse. The SBP Board further recommended that a complete audit of the applicants RC-SBP and SBP history be conducted to determine the correct RCSBP cost factor and the exact refund or collection amount.
CONCLUSIONS:
1. The evidence of record shows that on 12 August 1979, the applicant elected RC-SBP participation for his spouse. On
6 June 1984, the marriage ended in divorce and spousal coverage was suspended. He remarried on 28 November 1986, however, after his divorce the applicant unknowingly submitted a change in his RC-SBP options and selected an invalid election. On 28 November 1987, his current spouse became the automatic beneficiary. The mistake occurred when DFAS erroneously processed the election form for person with insurable interest (daughter), which resulted in the applicant paying premiums for spouse and for person with insurable interest (daughter). The applicant have been paying both premiums since 15 April 1995.
2. The election made by the applicant was not allowable by law since the member was participating with suspended spousal coverage. The applicant should only be paying spouse premiums.
3. Therefore, in view of the foregoing, findings, conclusions and the advisory opinion, it would be appropriate to correct the records as recommended below.
RECOMMENDATION:
That all of the Department of the Army records related to this case be corrected by changing the applicants participation from person with insurable interest to spouse only RC-SBP and by conducting a complete audit of his account in order to determine the correct RC-SBP cost factor and the exact refund or collection amount.
BOARD VOTE:
GRANT AS STATED IN RECOMMENDATION
GRANT FORMAL HEARING
DENY APPLICATION
CHAIRPERSON
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