During a divorce, a lot of things change financially for both of the estranged spouses. Because of the process, it is usually a bad idea to make any major financial decisions until the settlement is finalized. However, some divorce lawyers in Florida are recommending or instructing their clients to buy life insurance, and it is often a requirement in the final settlement agreement.
Divorce and life insurance
Life insurance seems like an odd thing to buy during a divorce, and some people might not even have a policy. But there is an aspect of life insurance that most people might not realize before they end their marriage, and it is one that makes a big difference. Life insurance policies can be written so that the benefit covers the ex-spouse as well as any children if the owner is required to pay alimony and/or child support. That means if they die while the policy is in effect, then the insurance company will take on the rest of the payments as part of the payout.
This is not a commonly-known aspect of life insurance, but it can be highly important, especially in cases where one person makes much more money from their job than the other, so the alimony payments are a major aspect of the other person’s income. A big life insurance policy should never be purchased unless it is required by the divorce settlement.
Done correctly, a good life insurance policy can protect the former spouse as well as any children from a sudden death of the policy holder.