Ensuring that you are properly covered by insurance following a divorce can be easily overlooked amid the emotional and financial tumult that accompanies the termination of a marriage. Nevertheless, divorce does require a careful reassessment of your insurance coverage if you want to remain protected against the financial risks that continue long after your divorce. If you are recently divorced, or going through a divorce, you should take steps to ensure that you are properly protected.
A change in auto ownership will require that you obtain car insurance coverage to coincide with that change. If you have your former spouse on your auto policy, you should remove him or her to protect yourself against potential liability and prevent his or her name from appearing on any future claim check. You should also advise your insurance company of any change in address.
If a divorce finds you living in a new residence, be sure to secure renter’s insurance. If you are staying in your present home, remove your ex-spouse’s name from the policy and consider changing property coverage if, for instance, your former spouse is taking jewelry or other items of value from the premises.
Life insurance serves a number of financial roles, chief among them is to help cover financial obligations in the event of a spouse’s death. Life insurance is often a key element of a divorce agreement, protecting against the loss of alimony income or child support should your former spouse die prematurely.
If you own a policy underwritten while you were married, be sure to review and update your beneficiary information.
If you or your ex-spouse was unable to work because of illness or injury, it could impact both parties. If disabled yourself, you’d need to find a way to pay your routine expenses like mortgage, phone, loan payments, etc. If your ex-spouse pays you alimony or child support and he/she became disabled, that could significantly impact your finances as well. Make sure you have adequate income protection on yourself. In addition, you may want to request that your ex-spouse maintain such a policy on him/herself as part of your divorce agreement.
Health coverage of your children is also typically an element of any divorce agreement. If you are required to cover your children and they are currently covered by your former spouse’s employer group plan, you may want to contact the employer to continue coverage under COBRA. If you have an individual policy, you may need to add your children to the policy. Whatever your situation may be, ensure that you are not duplicating coverage for your children.
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