One part of your estate plan and will may be the life insurance policy you must have to protect your family if you die. This money is intended to care for your spouse, children and any other dependents once you are no longer around to provide a consistent income.
When divorce is on the table, what are your responsibilities in regards to your ex? If you are the only working partner, it may be about more than just changing the beneficiary on the policy.
Future child support and alimony payments
If your spouse ends up with custody of the kids and you have an alimony payment, you may want to choose a policy that adequately covers these costs when you are gone. If you are considering a separate life insurance policy for your ex to ensure that your children are cared for after you are gone, make sure to figure in future alimony and child support payments.
In some situations, the spouse receiving child support and alimony may choose to take out his or her own policy on the other spouse and pay the premiums to ensure payment. You can determine the right option for your situation after a discussion with your attorney.
What to avoid
A group life policy from your job, a variable life insurance policy and accidental policies are generally life insurance policies that do not work well for divorced couples. You do not need many complicated conditions, just a certain amount of money if you or your spouse passes on.
Include the policy in the divorce decree
Once the marriage is over, intentions change. You or your spouse may have planned to pay for the life insurance policy, but financial worries, new marriages and even apathy can quickly change your priorities. To make sure the payments are made and that the conditions are met, any life insurance policy you have for or on your ex should be written into the divorce decree.
If you are getting a divorce and are not sure how to handle your life insurance policy, we encourage you to speak to an attorney immediately.
Call Korshak & Associates at 888-681-4389.