There’s a whole lot to think about and deal with when you get divorced. The paperwork alone can be extremely overwhelming. So it’s no surprise that people forget to deal with important things in the wake of their divorces. Many of them are burned out, and many simply forget because they have so much on their plates. So we’d like to take this opportunity to remind you that if you’re in the middle of a divorce (or even just planning for one in the near future), you’re going to need to address your insurance policies sometime soon.
What does that mean? That depends – it could mean removing your name from an insurance policy that your spouse (now ex) took out, or taking their name off one of your policies. It might also mean cancelling a policy you took out together, and getting a new one in your name only. It all depends on the type of policy, and what your financial plans are moving forward. So let’s take a look at what you’ll need to deal with…
You’ll need to update your life insurance policy after your divorce
The whole point of a life insurance policy is to ensure that, in the event of your death, your loved ones and family members are taken care of. But what happens when “family” becomes “former family”, and loved ones aren’t quite so… well, “loved” anymore. It happens. Relationships don’t always work out, and your paperwork will need to be updated to reflect that. So if you’ve got a life insurance policy that includes your spouse (or former spouse) as a beneficiary, you’ll need to adjust that.
In Michigan, designating a beneficiary in your life insurance policy is actually included in the divorce judgment. This means that it’s actually stated in your final court order (called a Judgment of Divorce) that your spouse won’t be the beneficiary of your life insurance. If for some reason you decide that you actually want your ex to remain as your beneficiary after the divorce, you’ll need to re-designate them as the beneficiary after your divorce is final.
Your insurance policy might be needed to help your kids in future
However, if it’s decided that your life insurance policy will be used to fund child support or alimony payments after your divorce is finalized (and in the event of your demise), your attorney can draft a very specific provision into the final divorce decree to make sure that happens. If you have children and your ex relies on your child support payments for their regular living expenses, deleting them as beneficiary might leave them, and your children, in major financial distress, should you pass away unexpectedly.
Handling your insurance policies, both during and after a divorce, can be stressful. In addition, you may be unsure of what the law requires of you, or what the right choice is in your particular situation. To make sure you get the best help and advice, talk to your skilled family law attorney at the Kronzek Firm. We’re familiar with all of the intricacies of Michigan divorce law as it applies to your insurance policies, and can provide you with direction that helps prepare you for your future. Call 866 766 5245 today and make sure you have the best team on your side.