How to secure life insurance even after divorce?

Posted: Fri Jun 19, 2009 11:21 am Post Subject:

1) Make it part of the divorce decree.
2) You should be the owner of the policy with your ex-husband the payer. This way, only you can make changes and you'll know if the policy isn't being paid.

Posted: Sat Jun 20, 2009 05:37 am Post Subject:

Hi Insurance Expert,

You should be the owner of the policy with your ex-husband the payer. This way, only you can make changes and you'll know if the policy isn't being paid.

Posted: Sun Jun 21, 2009 12:05 am Post Subject:

If you are the policy owner, then you are the only one that can make changes. Your husband would not be allowed to make himself a beneficiary for two reasons:

1. He's not the owner of the policy

2. The life insurance will be paid upon his death...they can't pay a dead person

I have seen many different ways to do it, and here is my suggestion. Have it mandated in the divorce decree that he mantain adequate life insurance so that it could continue to support the children should he pass away. The beneficiary should be a trust for the children, and the trustee can either be you as the mother...OR if he is not comfortable with it...most judges will allow him to assign an impartial trustee so that you may not misuse the funds.

I have seen many cases where the policy gets paid to the trust. The trustee pays the regular amount to the surviving spouse for child support, and then the remainder is used for the sole benefit of the children (college expenses, etc.)

Just be specific and make sure you understand the implications of any components of the decree!

Posted: Sun Jun 21, 2009 12:26 am Post Subject:

Does that mean the policy would have me as the name insured when he would pay the premium to keep it active? Or, the term 'policy owner' means that I'd have the possession of the policy document only?

Who should the policy name as beneficiary? Can my husband add himself as the beneficiary since he would be paying for it?

Posted: Sun Jun 21, 2009 12:30 am Post Subject:

I have seen many different ways to do it, and here is my suggestion. Have it mandated in the divorce decree that he mantain adequate life insurance so that it could continue to support the children should he pass away.

Posted: Mon Jun 22, 2009 01:58 am Post Subject:

I actually saw a case in which the husband and wife were getting a divorce. They had two children (12 and 14). The judge not only required that the husband carry life insurance, but also required that he pay for the policy for 6 years. Part of the assets he received as settlement were reduced and the policy was purchased.

In this case, the wife was the owner of the policy...AND there was no chance that the husband could stop paying! See if the judge would be willing to set something up, OR have it mandated that he pay the premium to you as part of child support. If you're able to do it that way, should non-payment ever become an issue...you'll know about it and have legal recourse.

(Recourse depends on state, but could include wage garnishment, etc.)

Posted: Mon Jun 22, 2009 05:54 am Post Subject:

How can I go about assigning myself as the owner of the policy? What rights would I have as the owner? Would the policy document have my name in it as the owner of the plan?

Posted: Tue Jun 23, 2009 04:23 am Post Subject:

You won't be able to assign yourself as the owner. If your husband is the current owner of the policy, he will have to name you as the owner. This is why you may need a court order or a specific request from the judge to help you do so.

The policy would clearly state that you were the owner. As owner, you would be the only one allowed to change beneficiaries and make any other changes. You would also be able to monitor and see if the policy was being paid on time and consistently.

Posted: Sat May 22, 2010 05:42 pm Post Subject: Assigned Life Insurance Policy

Two years ago in my Marital Agreement I was given 2 of my ex-husband's Life Insurance Policies as part of the Settlement. All necessary papers were signed by him, including an assigment which I sent to his Insurance Company and they recorded that assigment and I have personally paid the monthly premiums on such Policy for 2 years now. He died last week. In the "filed" Divorce papers it states that I am NOT entitled to collect on any Ira, Life Insurance or his Estate or be a part of his Will unless he made out a new Will naming me "after" the Divorce and that it has to go to a "secondary" Beneficiary instead or possibly to his Estate. So now the assignment is NOT any good when it comes to "me" collecting the Insurance Money on this Policy and I have to give it up to a secondary Beneficiary, which is his step-daughter who is my daughter, or could possibly go to his Estate which is now his daughter whom he hasn't had a relationship with for 25 years "until" the Divorce and "I" am out this money now ? Two years ago when I mentioned this wording in the "filed" Court Papers (not Marital Agreement Papers) he said "oh, don't worry about that wording" when I asked him about it "back then"......well, "now" I AM worried since the "time" has come to collect !

Posted: Sat May 22, 2010 06:02 pm Post Subject: correction on my last Insurance query

The person I told about the wording in the "filed" Court Papers was my Attorney. As other Divorce Papers (The Marital Agreement) did not contain the 2 pages that were also filed with the Courts along with the Agreement and was something I read several days "after" the Divorce was "filed" that I brought it to the attention of my Attorney since I "was" awarded the Life Insurance Policies in the Divorce Settlement and this wording was contradicting what the Marital Agreement had said was being given to me in that Settlement. And as I said, his comment was "Oh, don't worry about that" ! (wording) Well, as I said, I "AM" worried as it could be a contempt of the Court's rulings if I actually "do" collect this Insurance ?