Divorce and Your Life Insurance Policy
Even though we marry with the best intentions, sometimes we cannot live happily ever after, and must file for a divorce. While the divorce itself can be draining on our mental and emotional state, we should also consider the legal impact, including how it affects our life insurance policy.
How Many People Are Divorcing?
For a calendar year, the most current annual United States divorce rate is .76% (2002) of the entire population. This figure is down from .96% (1992) a decade earlier. In the most recent figures, in 2000 over 957,000 divorces were reported as completed in the U.S. According to some statisticians, about 40% of today's marriages will result in divorce.
Life Insurance Considerations During Divorce
During a divorce, you have three major concerns regarding life insurance, which Rapid Decision Term Life can assist you in making.
- Firstly, you and your spouse must decide who will become the owner of the different insurance policies that you possess. This is important because the owner manages the policy and can legally name the beneficiaries.
- Secondly, in the case that a group health plan covers both the spouses and children, you must determine the manner in which they will be covered following the divorce. If you lose coverage based on your employer, via COBRA, you may be qualified to buy further coverage for a maximum of three years. Also, you may need to buy extra health insurance coverage for your children and you.
- Thirdly, in the unfortunate case that the provider should die, you must learn what will happen to the funds from the alimony or support order. If life insurance is not provided, you may have to purchase it.
