For most Florida couples, the division of marital wealth is a top priority during a divorce. It is important to understand, however, that there are financial issues that range far beyond the division of existing assets. Life insurance is a prime example and is a matter that many spouses should carefully consider during property division negotiations.
Life insurance is important for spouses who expect to receive child support or spousal support payments from their soon-to-be ex. Without such a policy in place, the untimely death of a former partner can mean the immediate and permanent cessation of support payments. That can leave the surviving party in dire financial circumstances.
Life insurance is also important for individuals who will receive retirement assets that were earned through the employment of their spouse. If the spouse were to pass away before the full terms of the division of retirement assets were complete, the surviving spouse could encounter significant difficulty in claiming those assets. Life insurance provides an important safety net to protect against the unforeseeable.
During property division negotiations, it is possible to incorporate a life insurance policy that will protect against financial losses. Each and every Florida divorce is unique, and there are no hard and fast rules as to which party will be tasked with covering the cost of a life insurance policy. In many cases, the party who is expected to make child or spousal support payments is also required to purchase insurance. Regardless of who pays, having this important protection in place is well worth the initial investment to secure the policy.
Source: Forbes, "Divorcing Women: Don't Lose Out On Funds You're Entitled To", Jeff Landers, Dec. 7, 2016