BVA9502056 DOCKET NO. 93-06 731 ) DATE ) ) On appeal from the decision of the Department of Veterans Affairs Regional Office in St. Petersburg, Florida THE ISSUE Whether proceeds from life insurance were properly included as countable annual income for purposes of improved death pension. REPRESENTATION Appellant represented by: AMVETS ATTORNEY FOR THE BOARD Milo H. Hawley, Counsel INTRODUCTION The appellant is the surviving spouse of the veteran, who had active service from January 1948 to March 1969, and who died on May 20, 1991. This matter comes before the Board of Veterans' Appeals (Board) on appeal from an October 1992 amended award action by the Department of Veterans Affairs (VA) Regional Office in St. Petersburg, Florida (RO), which considered $17,000 in insurance proceeds in determining the appellant's countable annual income for the year beginning June 1, 1991. CONTENTIONS OF APPELLANT ON APPEAL It is contended that while the appellant filed a formal application for dependency and indemnity compensation in June 1991, she did not file a claim for improved death pension until June 1992. Since her claim for improved death pension was filed more than 45 days after the veteran's death, her receipt of life insurance proceeds on July 1, 1991, should not be considered. Accordingly, the award of pension should be reinstated effective from June 1991. DECISION OF THE BOARD The Board, in accordance with the provisions of 38 U.S.C.A. § 7104 (West 1991), has reviewed and considered all of the evidence and material of record in the veteran's claims file. Based on its review of the relevant evidence in this matter, and for the following reasons and bases, it is the decision of the Board that a preponderance of the evidence shows that the appellant's insurance proceeds were properly included for purposes of calculating her countable annual income. FINDINGS OF FACT 1. All relevant evidence necessary for an equitable disposition of the appellant's appeal has been obtained by the RO. 2. The appellant filed her claim for VA death benefits in June 1991, following the veteran's death in May 1991. This application was made on VA Form 21-534, Application For Dependency and Indemnity Compensation or Death Pension by a Surviving Spouse. On the form, she indicated she was claiming only dependency and indemnity compensation. 3. In June 1992, the appellant submitted a request that she be considered for VA death pension benefits. 4. By award action in August 1992, the RO awarded the appellant improved death pension benefits based on no countable income effective from June 1991. 5. Subsequently, in September 1992, information was received from the appellant that she had received $17,000 in life insurance proceeds on July 1, 1991. 6. By an amended award action in October 1992, the appellant's death pension award was retroactively terminated based on excessive income effective from August 1991 through May 1992. CONCLUSION OF LAW The appellant's proceeds from life insurance were properly included as countable income for purposes of computing her entitlement to improved death pension. 38 U.S.C.A. §§ 1503, 1541, 5107, 5110 (West 1991); 38 C.F.R. §§ 3.23, 3.271, 3.272 (1993). REASONS AND BASES FOR FINDINGS AND CONCLUSION The appellant's claim is "well grounded" within the meaning of 38 U.S.C.A. § 5107. We are satisfied that all relevant facts have been properly developed and that no further assistance is required to comply with the duty to assist mandated by 38 U.S.C.A. § 5107. With respect to the contention that the appellant did not file an application for death pension in June 1991, but only filed an application for dependency and indemnity compensation at that time, 38 C.F.R. § 3.152 (1993) provides that a claim by a surviving spouse for dependency and indemnity compensation will also be considered to be a claim for death pension. Therefore, it is clear that the appellant's formal application in June 1991 could appropriately be considered as being an application for death pension, as well as an application for dependency and indemnity compensation. Governing regulations provide that payments of any kind from any source shall be counted as income for improved death pension in the year in which received unless specifically excluded. 38 C.F.R. § 3.271. Life insurance proceeds, for purposes of improved death pension, are considered as income. 38 C.F.R. § 3.262(j)(2). Following the veteran's death in May 1991, the appellant submitted her application for VA death benefits in June 1991. The appellant indicated on the June 1991 application that she was applying for dependency and indemnity compensation benefits only. In June 1992, she requested that she be considered for improved death pension benefits. At the time of receipt of the appellant's June 1992 request for death pension, there was nothing of record indicating that the appellant had received life insurance proceeds following the veteran's death. Consistent with the provisions of 38 C.F.R. § 3.152, the RO construed the appellant's June 1991 application for death benefits as being a claim for death pension as well as dependency and indemnity compensation. In August 1992, the appellant was awarded improved death pension benefits, effective June 1, 1991, on the basis that she had filed her application within 45 days of the date of the veteran's death. Thus, the effective date of her award was the first day of the month of the veteran's death with payment of monetary benefits beginning the first day of the calendar month following the month the award became effective. 38 C.F.R. §§ 3.31, 3.400(c)(3) (1993). In September 1992, the appellant submitted a report which reflects that she received $17,000 in life insurance proceeds on July 1, 1991. Life insurance proceeds are included in calculating countable annual income for purposes of determining entitlement to improved pension benefits. Therefore, her award was properly terminated, effective August 1, 1991, the first day of the month following the month in which those proceeds were received. 38 C.F.R. § 3.660(a)(2) (1993). With regard to the appellant's contention that her pension award should be reinstated from June 1991, her position is inconsistent. If her June 1991 application is not to be considered an improved pension application for purposes of inclusion of the insurance proceeds as countable income, it similarly should not be considered such an application for establishing an entitlement date of June 1991. Her specific request for death pension was not submitted until June 1992. The appellant was in August 1992 retroactively awarded pension benefits effective from June 1991. It is noted that the VA has granted the appellant's request for waiver of the overpayment which resulted from the October 1992 award amendment. On the basis of the above analysis, the appellant's application for death pension was appropriately considered to have been received in June 1991, and her receipt of insurance proceeds in the amount of $17,000 on July 1, 1991, was properly considered in calculating her countable annual income for purposes of determining the amount of pension to which she was entitled. ORDER The appellant's insurance proceeds were properly included as countable annual income for purposes of improved death pension. The appeal is denied. JAMES R. ANTHONY Member, Board of Veterans' Appeals The Board of Veterans' Appeals Administrative Procedures Improvement Act, Pub. L. No. 103-271, § 6, 108 Stat. 740, ___ (1994), permits a proceeding instituted before the Board to be assigned to an individual member of the Board for a determination. This proceeding has been assigned to an individual member of the Board. NOTICE OF APPELLATE RIGHTS: Under 38 U.S.C.A. § 7266 (West 1991), a decision of the Board of Veterans' Appeals granting less than the complete benefit, or benefits, sought on appeal is appealable to the United States Court of Veterans Appeals within 120 days from the date of mailing of notice of the decision, provided that a Notice of Disagreement concerning an issue which was before the Board was filed with the agency of original jurisdiction on or after November 18, 1988. Veterans' Judicial Review Act, Pub. L. No. 100-687, § 402 (1988). The date which appears on the face of this decision constitutes the date of mailing and the copy of this decision which you have received is your notice of the action taken on your appeal by the Board of Veterans' Appeals.