Addressing Insurance Policies During Your Divorce
When you are working through a divorce, there are many issues you need to consider. Your child custody arrangements, how child support will be handled, whether either you or your spouse will need spousal support following the divorce, and a fair division of your property are all among the issues that need to be worked out before a divorce settlement is issued. Another issue that couples must consider is how they will divide their insurance policies. Some types of insurance, such as homeowner’s insurance, may be jointly held by a couple while others, like healthcare insurance, are held singly and the holder may seek benefits for his or her spouse.
Life insurance is often purchased to protect a family’s financial security in the event of an untimely death. Following a divorce, it can be used to provide spousal maintenance or child support in the event of the paying spouse’s death. Similarly, if permitted under the terms of the divorce, an individual might opt to change the beneficiary of his or her life insurance policy to ensure that his or her former spouse cannot access this money. Life insurance policies are generally handled as jointly-held property for many divorcing couples.
If both spouses are covered by one party’s healthcare benefits package, the spouse that holds the policy will need to remove his or her spouse from it when they divorce. Spouses who are removed from their former partners’ insurance policies may continue to receive coverage through the Consolidated Omnibus Budget Reconciliation Act (COBRA) for up to 36 months following the divorce, paying the full price themselves. In some cases, a spouse may negotiate that his or her former partner pay for such coverage following their divorce.
Car and Homeowners Insurance
Automobile and homeowner’s insurance policies are designed to protect the investment of the stated owner of the home or vehicle. If, as a result of the divorce, a car or a home changes ownership, the new owner must notify his or her insurance provider that the property has changed hands.
Individual Insurance Policies
Disability insurance and long-term care insurance are individually-held insurance policies, so these often do not come up during the divorce process. Both of these types of policies can provide funding for your care if you can no longer care for yourself. If spousal maintenance is part of your divorce settlement, consider having language added to your spousal maintenance agreement to address what will happen if the paying spouse becomes disabled. Although he or she can seek a modification for his or her spousal maintenance obligation, it is often much easier to address beforehand by including it in your divorce settlement.
Will County Divorce Attorneys
Call 708-518-8200 to schedule your initial legal consultation with Kezy & Associates. We can help you work through your insurance concerns and any other issues you have related to your divorce. Do not wait to begin working with an experienced Orland Park divorce attorney – when dealing with divorce, it is crucial that you be proactive and begin working with an attorney as soon as possible. We proudly serve clients throughout the greater Chicago area.