Case Interpreting a New Statute Concerning SBP and DIC

A request for reconsideration was made of the Navy's action on a settlement concerning a deceased Navy officer's widow whose Survivors' Benefit Plan (SBP) annuity was reduced because she was also entitled to Veterans Administration Dependency and Indemnity Compensation (DIC). The widow remarried after reaching age 60 and thereby lost entitlement to DIC. This case interpreted the new statute that allows certain surviving spouses whose SBP annuities have been reduced due to their entitlement to DIC, to have their SBP annuities reinstated in full upon loss of entitlement to DIC due to their marriage. Under the new provisions of applicable statute, the widow may be restored the full SBP annuity upon repayment of retired pay contribution she received when the SBP annuity was reduced. However, legislation prohibits full annuity to be paid for the months prior to October 1, 1978. Upon the repayment of the refund received by the widow, the Navy should adjust her annuity payments accordingly.