Protect life insurance during a divorce

Jul 02, 2012

People should protect their loved ones with life insurance

Wondering what to do with your life insurance policy during a divorce? Barbara Marquand of gave some "do's and don't's" of insurance for divorce, including what to do if there is a life insurance policy with the ex-spouse as the beneficiary.

"No matter what your will says, the life insurance policy is a contract, and that money will flow according to what the contract says," says Darren Scrimpshire, a managing director with Sapient Financial Group in San Antonio, according to the website.

Marquand said some couples leave the policy in the name of their ex to help protect their children, but she said if there isn't a level of trust the policy can be set up for a fund that will go to the children. She said people should work with their life insurance company when looking to make a change to make sure everything is going through as smoothly as possible, as any small error can be costly.

DivorceNet said most courts will say the providing spouse should maintain a life insurance policy that will cover the support payments for as long as they should be made. Couples and attorneys should work out what they want to do with a policy as amicably as possible.

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