21 Nov Managing Your Life Insurance After Divorce
Getting a divorce? You may want to review your life insurance.
Many people purchase life insurance to help family members stay financially sound when the policyholder dies. Yet, when a marriage ends, the topic of life insurance is too often overlooked. To ensure that you maintain a life insurance policy that stays in line with your family’s needs after a divorce, read on.
Determine how much coverage you’ll need
Examine what your ex-spouse’s financial situation would be like if alimony and/or child support payments end. You may need to talk to your trusted insurance agent to arrive at a specific amount.
Read through the divorce agreement
Life insurance policies are often used to secure alimony and child support payments. Before signing any documents, ensure they meet your needs and that you’ll be able to comply with them. Divorce agreements are legally binding and can be difficult to adjust.
Decide who will pay the premiums
Having your ex pay the insurance company may be convenient, but if you’re concerned about the possibility of default, talk with your lawyer about having payment responsibility written into the divorce agreement. You could also have your ex-spouse add you to the policy record so that you receive duplicate copies of billing and lapse notices.
Re-designate the beneficiaries
Many couples who have split will rename the beneficiaries of the life insurance on their ex-spouse to their children or create a trust to handle the proceeds of a premium. If your children are minors, consider appointing an adult custodian or trust to receive and handle the benefits on their behalf.
A comprehensive life insurance plan can protect your family and wallet. If you need help securing a life insurance policy is best for you and your family’s needs, get in touch with industry professionals. Contact Kevin or Marci to get started on securing the right life insurance today!