Life Insurance, Divorce And Support

Obtaining life insurance can become a very important part
of your divorce settlement.  Life insurance for intact family situations generally involves the husband and wife obtaining life insurance coverage listing their spouse and their children as beneficiaries on the policy. The surviving spouse receives the death benefit when the other spouse passes away and the insured party will receive peace of mind in knowing their family is taken care of when they are gone.

The need for life insurance changes when you are getting divorced. In many cases part of the divorce is granting alimony and child support to the spouse who is financially dependent. Alimony payments are designed to help the dependent spouse maintain the lifestyle they have grown accustomed to.  Child support is designed to help cover child care costs and all other expenses that are associated with being a full-time parent. What happens if the spouse who is paying alimony or child support dies.  Support payments end at the death of the paying parent and you cannot sue his/her estate for child support. You will end up with a financial hardship if your ex did not carry life insurance.

When representing our clients, we often request that the other party be ordered to carry life insurance for some period of time. There’s no hard and fast rule on when a court will grant that request. There is no law that specifically covers this question. However, factors the court will consider in making its decision include the support recipient’s age, education, work experience, and employment prospects. The court will also consider the duration of your marriage—i.e., a life insurance requirement is less likely after a five-year marriage than after a thirty-year one.

Usually, when maintaining a life insurance policy is agreed upon or ordered by the court, it is for a term life insurance policy. Term life insurance is a product that has level premiums and death benefit for a specified period of time. For example the term of the policy may be until the children turn 18 or graduate college or until a spouse is eligible for social security benefits.

You must make sure that your spouse is actually making the premium payments. You either need to check with the insurance company or have your spouse make the payments to you and you can make sure the premium is paid.

You may already have life insurance policies in place and these can simply be maintained. In other cases new policies must be put in place.

In many cases a spouse doesn’t want a lump sum of money going directly to their ex should they die. In these cases you may want a policy that will simply make monthly payments to the surviving spouse in exactly the same manner as he made those monthly payments during his lifetime. Of course, they would be guaranteed by a life insurance company so they would come on time every month. There would be no concern on the part of the husband of an unintended windfall, nor would there be any concern of a shortfall on the part of the wife.

In situations where the insurance is for the benefit of the children, a third-party can be named a trustee, thereby making sure that the money is spent only for the benefit of the children.

If you are facing issues regarding life insurance and divorce and require a Pittsburgh Pennsylvania area divorce lawyer please contact our firm.