M21-1, Part IV, Subpart iii, Chapter 1, Section A – Overview of Death Compensation and Dependency and Indemnity Compensation (DIC)

In This Section

Introduction

• definition of Death Compensation
• action to take if Death Compensation is a greater benefit for a surviving parent
• election of DIC in lieu of Death Compensation
• who to contact when an election of DIC is received, and
• considering in-service waiver of insurance premium cases.

Change Date

IV.iii.1.A.1.a.  Definition:  Death Compensation

• of a service-connected (SC) death occurring before January 1, 1957, or
• an in-service waiver of National Service Life Insurance (NSLI) or United States Government Life Insurance (USGLI) under 38 U.S.C. 1924 was in effect at the time of death, and death occurred
  • on or after May 1, 1957, but
  • prior to January 1, 1972.

• Death Compensation, see 38 CFR 3.4(c), and
• NSLI or USGLI, see 38 U.S.C. 1924.

IV.iii.1.A.1.b. Action to Take if Death Compensation Is the Greater Benefit for a Surviving Parent

• the circumstances described in M21-1, Part IV, Subpart iii, 1.A.1.a exist, and
• the rate of Dependency and Indemnity Compensation (DIC) payable to the parent is less than the rate of Death Compensation payable.

IV.iii.1.A.1.c.  Election of DIC in Lieu of Death Compensation

IV.iii.1.A.1.d. Who to Contact When an Election of DIC Is Received

IV.iii.1.A.1.e. Considering In-Service Waiver of Insurance Premium Cases

• Provide notice to all affected Death Compensation beneficiaries of their right to elect DIC.
• If cases are encountered during routine handling, in which the beneficiaries have not elected DIC, furnish a reminder of the right of election and take related actions as provided in this section.

• PL 92-197 repealed 38 U.S.C. 417(a) that had limited entitlement to Death Compensation under 38 CFR 3.5(b)(3) and 38 CFR 3.702(a).
• If election of DIC is received, the effective date provisions of 38 CFR 3.114(a)(3) apply.

Introduction

• definition of DIC
• when the pay grade code is required
• basis for pay grade codes
• verification of data from a service department, for a deceased Veteran who was receiving retired pay
• action to take if
  • pay grade data is not of record, and
  • payment of DIC is pending verification of pay grade data
• when the pay grade code is not required
• DIC under 38 U.S.C. 1318
• automatic 38 U.S.C. 1318 DIC payments to eligible surviving spouses, and
• DIC under 38 U.S.C. 1151.

Change Date

IV.iii.1.A.2.a.  Definition:  DIC

• to a surviving spouse, child, or parent because of an SC death that occurred
  • on or after January 1, 1957 or
  • before January 1, 1957, if the survivor elects to receive DIC in lieu of Death Compensation, per 38 U.S.C. 1310
• to a surviving spouse or child because the Veteran had been rated as totally disabled due to an SC disability prior to his/her death, typically for at least ten years, per 38 U.S.C. 1318, or
• to a surviving spouse, child, or parent because of death due to VA medical treatment, per 38 U.S.C. 1151.

• 38 CFR 3.5
• 38 CFR 3.22
• 38 CFR 3.358, and
• 38 CFR 3.702.

IV.iii.1.A.2.b.  When the Pay Grade Code Is Required

• 38 U.S.C. 1311(a)(3), which is based on the Veteran’s pay grade, or
• 38 U.S.C. 1311(a)(1) and 38 U.S.C. 1311(a)(2), which is based on the basic rate of DIC and any additional allowance payable because the Veteran was rated as totally disabled for at least eight continuous years and married to the surviving spouse for the same period of time.

IV.iii.1.A.2.c. Basis for Pay Grade Codes

• for a Veteran who died in service, his/her rank as of the date of the Veteran’s death or as of the date of a promotion after death while in a missing status
• for a Veteran who died after service, his/her rank on the date of last separation from service under conditions other than dishonorable, or
• a higher rank held for a period of six months or more meeting the requirements of 38 U.S.C. 1302(d), if applicable.

IV.iii.1.A.2.d.  Verification of Data From a Service Department, for a Deceased Veteran Who Was Receiving Retired Pay

• Service departments routinely furnish evidence showing the pay grade for retired personnel.
• Pay grade information may also be found on DD Form 214, Certificate of Release or Discharge from Active Duty, or other discharge document.

IV.iii.1.A.2.e.  Action to Take if Pay Grade Data Is Not of Record

IV.iii.1.A.2.f. Action to Take if Payment of DIC Is Pending Verification of Pay Grade Data 

IV.iii.1.A.2.g.  When the Pay Grade Code Is Not Required

• awards of DIC to children or parents
• awards of any benefit other than DIC to any beneficiary, or
• awards based on a Veteran’s death after December 31, 1992.

IV.iii.1.A.2.h.  DIC Under 38 U.S.C. 1318

IV.iii.1.A.2.i.Automatic 38 U.S.C. 1318 DIC Payments to Eligible Surviving Spouse

IV.iii.1.A.2.j.  DIC Under 38 U.S.C. 1151

• not the result of the Veteran’s willful misconduct, and
• attributable to
  • hospital care, medical or surgical treatment, or examination furnished the Veteran under any law administered by the Secretary, either by a VA employee or in a VA facility as defined in 38 U.S.C. 1701(3)(A)
  • participation in vocational rehabilitation training under 38 U.S.C. Chapter 31, or
  • participation in compensated work therapy.