Who Takes Ownership of a Life Insurance Policy in a Divorce?
Who should be the owner of life insurance policies related to a divorce settlement?
To answer that question, first consider the purpose of the life insurance policies. Often, life insurance is used to protect the income of a spouse providing alimony and/or child support. The policy would insure the life of the spouse providing child support, and the beneficiary would be the spouse receiving the support. This way, if the providing spouse were to die, the life insurance proceeds can be used to replace the lost income.
Resources & Tools
PROTECTION AFTER DIVORCE -- COBRA, the Consolidated Omnibus Budget Reconciliation Act, protects ex-spouses even after one of them remarries, for a fixed period of time, as well as employees who lose their positions. COBRA establishes a time line for picking up coverage (which must be religiously observed), and it is very expensive.
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"A Plain English Guide to Protecting Your Children"
Author: Mary L. Boland, Attorney at Law
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