RECORD OF PROCEEDINGS


      IN THE CASE OF:    .


      BOARD DATE:        27 July 2006
      DOCKET NUMBER:  AR20050015462


      I certify that hereinafter is recorded the true and complete record
of the proceedings of the Army Board for Correction of Military Records in
the case of the above-named individual.

|     |Mr. Carl W. S. Chun               |     |Director             |
|     |Mrs. Nancy L. Amos                |     |Analyst              |

      The following members, a quorum, were present:

|     |Mr. John T. Meixell               |     |Chairperson          |
|     |Mr. Jeffrey C. Redmann            |     |Member               |
|     |Mr. Edward E. Montgomery          |     |Member               |

      The Board considered the following evidence:

      Exhibit A - Application for correction of military records.

      Exhibit B - Military Personnel Records (including advisory opinion,
if any).

THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:

1.  The applicant requests that his records be corrected to show that he
did not elect to participate in the Reserve Component Survivor Benefit Plan
(RCSBP) and that he be refunded all SBP premiums paid.

2.  The applicant states he had no SBP counseling.  He did not know what
the NIP (natural interest person) coverage was.  He did not want the NIP
coverage.  His son is 28 years old and does not need the SBP.

3.  The applicant provides no additional evidence.

CONSIDERATION OF EVIDENCE:

1.  The applicant was born on 4 December 1944.  After having had prior
service in the U. S. Air Force and the Army National Guard, he enlisted in
the U. S. Army Reserve on 24 February 1987.

2.  On 2 February 2001, the U. S. Army Reserve Personnel Command provided
the applicant his notification of eligibility for retired pay at age 60
(his 20-year letter).  Paragraph 4 of the letter states, "You are entitled
to participate in the Reserve Component Survivor Benefit Plan…If you do not
elect coverage and should die before age 60, your survivors will not be
entitled to benefits.  Enclosed is DD Form 1883 and detailed information
about RC-SBP."

3.  On 9 May 2001, the applicant completed the DD Form 1883.  He was
apparently not married and had no dependent children.  He elected NIP
coverage, option C, and listed his son Victor, born on 15 July 1977, as the
insurable interest coverage beneficiary.  Section II of the form informed
him, “IMPORTANT:  The decision you make with respect to participation in
this Survivor Benefit Plan is a permanent irrevocable decision.  Please
consider your decision and its effect very carefully.”

4.  The reverse side of the DD Form 1883, Monthly Cost and Annuity,
informed the applicant of the cost of NIP coverage (i.e., 10 percent of
full retired pay, plus an additional 5 percent of full retired pay for each
full five years that the member’s age exceeds that of the NIP, not to
exceed 40 percent of retired pay).

5.  The applicant applied for retired pay by completing a DD Form 2656
(Data for Payment of Retired Personnel) on 4 February 2003.  He properly
did not complete Section IX (Survivor Benefit Plan (SBP) Election), since
he had previously elected to participate in the RCSBP.

6.  The applicant turned age 60 on 4 December 2004.

7.  On 25 May 2006, the Defense Finance and Accounting Service informed
the Board analyst that the applicant’s RCSBP NIP coverage was stopped on
    1 September 2005.

8.  In the processing of this case, an advisory opinion was obtained from
the     U. S. Army Human Resources Command – St. Louis, MO (previously the
U. S. Army Reserve Personnel Command).  That office noted that NIP SBP
coverage may be cancelled at any time; however, even if the Soldier cancels
the NIP coverage, he or she will have to pay the Reserve component cost of
the NIP coverage once they start drawing retired pay at age 60 (for the
next 30 years).  (The advisory opinion also erroneously stated that the
applicant could get out of paying the Reserve component portion of the NIP
coverage by completing a DD Form 2656-2 (Survivor Benefit Plan (SBP)
Termination Request).  Completing a DD Form 2656-2 only terminates current
participation in the SBP; the Reserve component portion must still be
paid.)

9.  A copy of the advisory opinion was provided to the applicant for
comment or rebuttal.  He did not respond within the given time frame.

10.  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.  A
person who is not married and does not have a dependent child upon becoming
eligible to participate in the SBP may elect to provide an annuity to a
natural person with an insurable interest in the member.  Premiums for
insurable interest coverage are generally higher than for any other
category of coverage.

11.  Public Law 95-397, the RCSBP, enacted 30 September 1978, provided a
way for those who had qualified for reserve retirement but were not yet age
60 to provide an annuity for their survivors should they die before
reaching age 60.  Three options are available:  (A)  elect to decline
enrollment and choose at age
60 whether to start SBP participation; (B)  elect that a beneficiary
receive an annuity if they die before age 60 but delay payment of it until
the date of the member’s 60th birthday; (C)  elect that a beneficiary
receive an annuity immediately upon their death if before age 60.  Once a
member elects either Option B or C in any category of coverage, that
election is irrevocable.  Option B and C participants do not make a new SBP
election at age 60.  They cannot cancel SBP participation or change options
they had in RCSBP – it automatically rolls into SBP coverage.  If RCSBP
option B or C is elected, there is a Reservist Portion cost added to the
basic cost of the SBP to cover the additional benefit and assured
protection had the member died prior to age 60.
12.  Title 10, U. S. Code, section 1452(c) (Reduction for Insurable
Interest Coverage), subsection 1452(c)(1)(B) states that, in the case of a
person providing a Reserve component annuity, the reduction [in retired
pay] shall be by an amount prescribed under regulations of the Secretary of
Defense.

13.  The Department of Defense Financial Management Regulation, volume 7B,
paragraph 570306 states an RCSBP participant who voluntarily terminates
coverage for a natural person with an insurable interest (not a former
spouse) will pay the Reserve add-on premium for the lifetime of the member.

DISCUSSION AND CONCLUSIONS:

1.  The applicant contended that he had no SBP counseling and did not know
what the NIP coverage was, that he did not want the NIP coverage, and that
his son is 28 years old and does not need the SBP.

2.  The applicant’s contentions have been carefully considered.  However,
the DD Form 1883 warned him that his RCSBP decision would be irrevocable.
The reverse side of the DD Form 1883 informed him how much NIP coverage for
his son would cost.  He was provided detailed SBP information with his 20-
year letter.  If he had any questions, he could have called the U. S. Army
Reserve Personnel Command for more detailed information.

3.  The applicant’s RCSBP NIP coverage was terminated on 1 September 2005;
however, in accordance with statute and Department of Defense authority, he
is required to continue to pay the RCSBP add-on premium (for the next 30
years) for the protection his son would have received had the applicant
died prior to turning age 60.

4.  Regrettably, the applicant has provided insufficient evidence that
would warrant granting the relief requested.

BOARD VOTE:

________  ________  ________  GRANT FULL RELIEF

________  ________  ________  GRANT PARTIAL RELIEF

________  ________  ________  GRANT FORMAL HEARING

__jtm___  __jcr___  __eem___  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

The Board determined that the evidence presented does not demonstrate the
existence of a probable error or injustice.  Therefore, the Board
determined that the overall merits of this case are insufficient as a basis
for correction of the records of the individual concerned.




                                  __John T. Meixell_____
                                            CHAIRPERSON



                                    INDEX

|CASE ID                 |AR20050015462                           |
|SUFFIX                  |                                        |
|RECON                   |                                        |
|DATE BOARDED            |20060727                                |
|TYPE OF DISCHARGE       |                                        |
|DATE OF DISCHARGE       |                                        |
|DISCHARGE AUTHORITY     |                                        |
|DISCHARGE REASON        |                                        |
|BOARD DECISION          |DENY                                    |
|REVIEW AUTHORITY        |Mr. Chun                                |
|ISSUES         1.       |137.04                                  |
|2.                      |                                        |
|3.                      |                                        |
|4.                      |                                        |
|5.                      |                                        |
|6.                      |                                        |


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