[Federal Register Volume 81, Number 70 (Tuesday, April 12, 2016)]
[Rules and Regulations]
[Pages 21465-21468]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-08381]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 9

RIN 2900-AN40


Servicemembers' Group Life Insurance and Veterans' Group Life 
Insurance--Slayer's Rule Exclusion

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: The Department of Veterans Affairs adopts as final, without 
change, the final rule seeking comments published on October 3, 2012, 
amending its regulations governing Servicemembers' Group Life Insurance 
(SGLI) and Veterans' Group Life Insurance (VGLI). Specifically, this 
rule prohibits paying insurance proceeds because of the death of a 
person (decedent) whose life was insured under SGLI or VGLI, or paying 
a SGLI Traumatic Injury Protection (TSGLI) benefit to a person (slayer) 
convicted of

[[Page 21466]]

intentionally and wrongfully killing the decedent or determined in a 
civil proceeding to intentionally and wrongfully killing the decedent. 
This prohibition of payment also applies to any family member of the 
slayer who is not related to the decedent and to any person who 
assisted the slayer in causing the death of the decedent. Additionally, 
the term ``domestic partner'' is removed from the definition of 
``member of the family''.

DATES: Effective Date: This final rule is effective April 12, 2016.

FOR FURTHER INFORMATION CONTACT: Monica Keitt, Attorney/Advisor, 
Department of Veterans Affairs, Insurance Center, 5000 Wissahickon 
Avenue, Philadelphia, PA 19144, (215) 842-2000, ext. 2905. (This is not 
a toll-free number.)

SUPPLEMENTARY INFORMATION: On October 3, 2012, VA published in the 
Federal Register (77 FR 60304) a final rule seeking comments that 
amended 38 CFR 9.1 and 9.5 to prevent certain persons from receiving 
insurance proceeds through the SGLI, VGLI, or TSGLI program as 
beneficiaries. The rule prevents payment of proceeds to any persons 
(slayer) found criminally or civilly liable for intentionally and 
wrongfully killing a person (decedent) insured under SGLI or VGLI or 
who is eligible for a TSGLI benefit. It also prevents payment to any 
persons found criminally or civilly liable for assisting or aiding such 
a slayer and any member of the slayer's family who is not related to 
the decedent by blood, legal adoption, or marriage. In a proposed rule 
published on December 13, 2011, (76 FR 77455), ``domestic partner'' was 
added to the definition of ``member of the family'' in 38 CFR 9.1(l) 
for the purposes of 38 CFR 9.5(e) to prevent unjust enrichment of 
persons who are domestic partners of the slayer based on the rationale 
that these persons are often in relationships with the slayer 
equivalent to being ``relatives'' of the slayer. Then, in the final 
rule published on October 3, 2012, VA removed the term ``domestic 
partner'' from the definition of ``member of the family'' for the 
purposes of Sec.  9.5(e) ``due to the unsettled legal landscape 
surrounding the recognition of such partnerships''. 77 FR at 60305. VA 
explained that because recognition of the legality of such 
relationships varies from state to state, VA determined that including 
such partnerships in this part would cause an undue administrative 
burden. Interested persons were invited to submit, on or before 
December 3, 2012, written comments regarding removing the term 
``domestic partner'' from the definition. VA received comments from 
three individuals objecting to removing the term.

Public Comments Regarding Removal of the Term ``Domestic Partner''

    Two commenters noted that some federal agencies, including VA, have 
expanded their program definitions of family members to include 
domestic partners. One commenter noted that a Presidential Memorandum 
directed Federal agencies to extend certain benefits currently 
available to Federal employees' spouses and their children to Federal 
employees' same-sex domestic partners and their children. See 
Presidential Memorandum--Extension of Benefits to Same-Sex Domestic 
Partners of Federal Employees (June 2, 2010). One commenter noted that 
other Federal agencies, such as the General Services Administration, 
have established through regulations definitions of family members that 
include domestic partners.
    One commenter also stated that failure to include domestic partners 
in the definition of ``member of the family'' would allow a same-sex 
domestic partner of a slayer to circumvent the regulation, while 
prohibiting heterosexual spouses of a slayer from receiving insurance 
benefits. This commenter also stated that ``. . . [i]ncluding domestic 
partners is important to prevent an aberration in the rule . . .'' and 
to ``. . . prevent[ ] the unjust collection of life insurance 
benefits.''
    Two commenters noted that the Department of Defense changed its 
military policies regarding openly gay and lesbian servicemembers, thus 
VA should change its policy here, since VA is a related agency that 
serves servicemembers and their families.
    Two commenters also noted that VA has recognized domestic 
partnerships in other VA related matters. Specifically, the commenters 
pointed to VA's hospital visitation policy allowing persons designated 
as domestic partners to be beneficiaries for SGLI and VGLI benefits.
    Lastly, one commenter noted that removal of the term domestic 
partner ``sends a message that VA may not be willing to recognize 
domestic partners as family in any context.'' However, recent Supreme 
Court cases and the United States Attorney General help to clarify 
legally accepted definitions. On June 26, 2013, the Supreme Court in 
United States v. Windsor, 133 S. Ct. 2675 (2013), held that the Defense 
of Marriage Act (DOMA), Sec. 3, Public Law 104-199, 110 Stat. 2419, 
defining ``marriage'' and ``spouse'' for purposes of federal law to 
preclude recognition of marriages of same-sex couples, is 
unconstitutional because it violates Fifth Amendment principles by 
discriminating against same-sex couples who are legally married under 
state law. VA administers federal benefits and programs that require 
defining ``spouse'' and ``surviving spouse.'' For purposes of VA 
benefits, 38 U.S.C. 101(3) and 101(31) define ``surviving spouse'' and 
``spouse'' as persons ``of the opposite sex.'' However these 
definitions (codified separately from DOMA) were not specifically 
addressed in the Supreme Court's Windsor decision. Then on September 4, 
2013, the United States Attorney General announced that the President 
had directed the Executive Branch to cease enforcement of 38 U.S.C. 
101(3) and 101(31), to the extent they preclude provision of veterans' 
benefits to same-sex married couples, but was silent as to ``domestic 
partners''. Accordingly, VA ceased to enforce the definitional 
provisions in title 38 to the extent they preclude provision of 
veterans' benefits, including SGLI, VGLI, and TSGLI benefits, to same-
sex married couples. As a result, VA administers spousal and survivors' 
benefits to same-sex married couples, provided the marriages meet the 
requirements of 38 U.S.C. 103(c). Section 103(c) provides that, for 
purposes of all laws administered by VA, a veteran's marriage is to be 
recognized according to the law of the place where the parties resided 
at the time of the marriage or the law of the place where the parties 
resided when the right to benefits accrued.
    On June 26, 2015, the Supreme Court in Obergefell v. Hodges, 135 S. 
Ct. 2584 (2015), held that the Fourteenth Amendment of the U.S. 
Constitution requires a state to license a marriage between two people 
of the same sex and to recognize a marriage between two people of the 
same sex when their marriage was lawfully licensed and performed out-
of-state, but again did not include ``domestic partners''. Accordingly, 
VA now recognizes all lawful same-sex marriages for VA purposes.
    In light of Windsor and Obergefell, VA no longer enforces the title 
38 definitions of ``spouse'' and ``surviving spouse'' to the extent 
that they exclude the recognition of same-sex married couples. However, 
In other words, VA provides benefits to all same-sex ``spouses'' and 
``surviving spouses'' of veterans or, in the case of insurance 
benefits, of servicemembers or former servicemembers, to the extent 
they are otherwise eligible, based on a State's recognition of the 
validity of the

[[Page 21467]]

marriage. However, VA does not currently provide all the same spousal 
benefits to either same-sex or opposite-sex domestic partners of 
veterans or, in the case of insurance benefits, of servicemembers or 
former servicemembers.
    The comments we received essentially concern equal treatment of 
same-sex couples and opposite-sex couples. The Supreme Court in Windsor 
and Obergefell accomplished that with regard to marriages but did not 
address other relationships, such as domestic partnerships or legal 
unions. Thus, those decisions do not affect VA's decision to remove 
``domestic partner'' from the Sec.  9.1(l) definition of ``member of 
the family.'' Windsor and Obergefell have not changed the unsettled 
legal landscape surrounding the recognition of both same-sex and 
opposite-sex domestic partnerships. For instance, recognition of the 
legality of domestic partnerships continues to vary from state to state 
and, because the term is not used consistently from state to state, 
there remains inter-jurisdictional confusion regarding use of that 
term. Therefore, including domestic partnerships, of both same-sex 
couples and opposite-sex couples, in the definition of ``member of the 
family'' in Sec.  9.1(l) would cause an undue administrative burden in 
applying 38 CFR 9.5(e).
    Two commenters suggested that VA could establish its own uniform 
definition of ``domestic partnership'' rather than relying upon varying 
state laws. The commenters pointed to regulations of other federal 
agencies establishing definitions of ``domestic partnerships.'' We 
decline that suggestion for the following reasons. First, it would 
create inconsistency between VA's recognition of marriages, which, 
under 38 U.S.C. 103(c), is expressly based on state laws recognizing 
marriages, and VA's recognition of domestic partnerships or civil 
unions, which, under the commenters' suggestion, could be inconsistent 
with state laws governing recognition of such relationships. Second, 
defining the term ``domestic partner'' without regard to state law 
would require VA to undertake difficult and burdensome fact-finding 
actions under imprecise standards. We note that the other agency 
regulations cited by the commenters are varied and often employ vague 
and subjective standards, such as requiring a finding that the 
individuals are in a ``committed relationship'' or ``agree to be 
responsible for each other's common welfare,'' which may lead to 
inconsistency in application. Third, VA likely would face difficulty in 
developing evidence to establish that such standards are satisfied. The 
primary evidence of whether individuals were in a ``committed 
relationship'' often may be the testimony of the individuals in that 
relationship. Such evidence may be difficult to obtain or may be 
unreliable in relation to this rule, which, unlike the examples cited 
by the commenters, would preclude, rather than extend, benefits based 
upon the relationship.
    Regarding a comment that excluding domestic partnerships from the 
definition of ``family members'' may result in unjust enrichment to 
certain domestic partners of persons causing the death of an insured 
individual, we acknowledge that this is a potential consequence of the 
rule. However, the alternative standards we have considered, including 
following varied state laws governing domestic partnerships or 
establishing our own definition of ``domestic partnership'' based in 
part on subjective standards, would also pose a risk of yielding 
inconsistent results and possibly allowing unjust enrichment to certain 
individuals in specific cases. We believe we have appropriately 
balanced those risks with the interests of clarity, consistency, and 
administrative efficiency in determinations made under this rule. 
Accordingly, VA declines to make any changes to this rulemaking based 
on the above comments.

Justification for the Final Rule Seeking Comments

    One commenter noted that VA failed to provide good cause for 
dispensing with advance public notice and the opportunity for public 
comment. Specifically, the commenter stated that VA failed to provide a 
sufficient justification for citing ``public interest'' and 
``impracticability'' as reasons for proceeding without providing an 
opportunity for advance notice and comment. We correctly identified 
public interest as grounds for proceeding with final rule seeking 
comments, but could have been clearer in explaining that it would have 
been against the public's interest to delay implementation of the 
slayer provisions for the purpose of receiving comments on the 
definition of ``member of the family.'' We designed the rule to prevent 
slayers from benefiting from their wrongdoing, and any delay in 
finalizing the rule would have potentially permitted slayers to receive 
benefits in violation of public policy and ethical concerns. 
Nonetheless, on October 3, 2012, VA provided the public formal notice 
and an opportunity to comment on the exclusion of the term ``domestic 
partner'' through publication of the final rule seeking comments. VA 
received comments on the exclusion, and we considered those comments in 
issuing this final rule. Additionally, we note that, since the 
publication of the October 3, 2012, rule, no case has been affected by 
the exclusion of ``domestic partner'' from the definition of ``member 
of the family.''
    Based on the rationale set forth above and the preamble in the 
final rule seeking comments, VA adopts, without change, the rule 
published on October 3, 2012, at 77 FR 60304.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in an expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year. This final rule will have no such effect on 
State, local, and tribal governments or on the private sector.

Paperwork Reduction Act

    This final rule contains no provisions constituting a collection of 
information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3521).

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess the 
costs and benefits of available regulatory alternatives and, when 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, and other advantages; distributive impacts; 
and equity). Executive Order 13563 (Improving Regulation and Regulatory 
Review) emphasizes the importance of quantifying both costs and 
benefits, reducing costs, harmonizing rules, and promoting flexibility. 
Executive Order 12866 (Regulatory Planning and Review) defines a 
``significant regulatory action'' requiring review by the Office of 
Management and Budget (OMB), unless OMB waives such review, as ``any 
regulatory action that is likely to result in a rule that may: (1) Have 
an annual effect on the economy of $100 million or more or adversely 
affect in a material way the economy, a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or State, local, or tribal governments or communities; (2) 
Create a serious inconsistency or

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otherwise interfere with an action taken or planned by another agency; 
(3) Materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
this Executive Order.''
    The economic, interagency, budgetary, legal, and policy 
implications of this regulatory action have been examined, and it has 
been determined not to be a significant regulatory action under 
Executive Order 12866. VA's impact analysis can be found as a 
supporting document at http://www.regulations.gov, usually within 48 
hours after the rulemaking document is published. Additionally, a copy 
of the rulemaking and its impact analysis are available on VA's Web 
site at http://www.va.gov/orpm/, by following the link for ``VA 
Regulations Published from FY 2004 Through Fiscal Year to Date.''

Regulatory Flexibility Act

    The Secretary of Veterans Affairs hereby certifies that this final 
rule will not have a significant economic impact on a substantial 
number of small entities as they are defined in the Regulatory 
Flexibility Act, 5 U.S.C. 601-612. This final rule will directly affect 
only individuals and will not directly affect any small entities. 
Therefore, this rulemaking is also exempt pursuant to 5 U.S.C. 605(b), 
from the initial and final regulatory flexibility analysis requirements 
of sections 603 and 604.

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance number and title for the 
program affected by this document is 64.103, Life Insurance for 
Veterans.

Signing Authority

    The Secretary of Veterans Affairs, or designee, approved this 
document and authorized the undersigned to sign and submit the document 
to the Office of the Federal Register for publication electronically as 
an official document of the Department of Veterans Affairs. On April 6, 
2016, Robert D. Snyder, Chief of Staff, Department of Veterans Affairs, 
approved this document for publication.

List of Subjects in 38 CFR Part 9

    Life insurance, Military personnel, Veterans.

    Dated: April 7, 2016.
William F. Russo,
Director, Office of Regulation Policy & Management, Office of the 
General Counsel, Department of Veterans Affairs.

    For the reasons set forth out in the preamble, VA adopts the final 
rule seeking comments published in the Federal Register at 77 FR 60304 
on October 3, 2012, as final without change.

[FR Doc. 2016-08381 Filed 4-11-16; 8:45 am]
 BILLING CODE 8320-01-P