Divorce could bring up life insurance questions

Nov 11, 2010

Couples facing divorce may also have to deal with life insurance concerns.

A divorce may present a number of financial considerations for the parties involved, including what should be done about life insurance policies.

The Insurance Information Institute notes that members of a couple may list each other as beneficiaries on a life insurance policy. Keeping the status quo even through a divorce may prove to be wise, according to the organization.

"If one party is providing alimony and child support to the other, this may mean a loss of income to the surviving party if he or she dies," the III said.

Others may consider purchasing a life insurance policy on the party that will get primary custody of children. This can provide for kids if this person should pass away.

The Institute suggested couples consider term life insurance policies if the purpose of the protection is solely to provide for children. These products are generally less expensive and last a certain amount of time.

If they do decide to change beneficiaries on a life insurance policy, couples can do so by contacting the policy provider. Those who want to expand or change their coverage in other ways can do the same.

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