If you, or a loved one, are going through a divorce, you’re well aware that it’s a difficult and complicated process. There is so much to consider. The division of assets, child custody, alimony; the list goes on. In any case, life insurance is an important part of the divorce negation process.
Though it’s not the first thing most couples think of when starting divorce proceedings, life insurance is generally part of the settlement. In most cases the supporting spouse is required to carry a life insurance policy that names the dependant spouse as a beneficiary. Settlements often go on to specify how long the term life insurance policy must be maintained.
Why Update Your Term Life Insurance?
Not only is it important to updated your term life insurance policy at the time of your divorce but it’s extremely important to update it with every major milestone in your life. Divorced couples often go their separate ways, purchase new homes and start new relationships; without updating their term life insurance policies.
An example would be Mr. Jones who pays child support and alimony to his ex-wife with whom he shares a child. Mr. Jones is now remarried and has another child. If Mr. Jones were to pass away, he would like his death benefit to be divided among his children as well as his current and ex-wife. In order to ensure that this would happen, Mr. Jones would need to change his beneficiaries with his insurance carrier. If he didn’t take the time to update his policy after remarrying and the birth of his second child, his current wife and youngest child would not be protected under his policy.
While it’s important to ensure that your life insurance coverage remains in compliance with your divorce settlement, it’s also important to ensure that your policy protects all of your dependants. Make the commitment today to keep your coverage up-to-date.
Get Started Today!
The process of updating your term life insurance is actually quite simple. Your life insurance agent will be happy to discuss your situation and help you make the appropriate changes. Discuss your current needs and consider how they may change. Now that you’ve updated your term life insurance coverage, commit to revisit the issue with your agent regularly. Perhaps you will remarry down the road, or even have more kids. Regardless, your needs are sure to change and so too should your term life insurance coverage.
Interested in more tips and advice about maintaining your whole or term life insurance? Follow the IntelliQuote Life Insurance Blog for the insight and advice you’re looking for – while you’re here, check out these recent posts:
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