Life insurance steps to take during your divorce.
Your life insurance is designed to provide financial protection for your loved ones in the event of your unexpected death. While this sounds straightforward enough, this coverage can become a little more complicated when you are going through a divorce. Here are some of the adjustments you should make to your life insurance when you are going through a divorce.
- Review Divorce Agreements Carefully
Your life insurance policy can be used to secure alimony and child support payments. In your divorce agreement, your financial obligations towards your ex will be laid out. In some cases, these payments may be higher than you can actually afford. In this case, you should not sign the agreement and ask that adjustments be made. If you sign the papers without carefully reviewing them first, then you will have trouble altering the agreement because it is legally binding.
- Mandate Who Will Pay Premiums
If your ex has a life insurance policy that will provide for you and your children in the event of their unexpected death, then you need to make sure that they continue to pay their premiums. If you are concerned about the possibility of default, then you should speak to your lawyer about adding payment responsibility into the divorce agreement to ensure that your former spouse doesn’t allow their policy to lapse due to non-payment.
- Change Beneficiaries
Oftentimes, separated couples will change the beneficiaries listed on their life insurance policies. Usually, the policyholder will remove their spouse as a beneficiary and leave their children to receive the full death benefit. If your children are minors, then you should create a trust where your life insurance benefit will be held until your kids reach a certain age.
These are some of the steps that you should take to manage your life insurance after a divorce. Do you have more questions about your life insurance coverage? If so, then contact the experts at Patterson & Associates in Richardson, Texas. We are ready to assist you with all your personal coverage needs today.