3 Reasons To Review Your Life Insurance Policy After Going Through A Divorce
Divorce can be a sensitive subject.
After all, divorces can be an emotional roller coaster let alone managing the financial implications of it all. From child support payments, attorney fees, alimonies, and more, divorce can be overwhelming at times to deal with.
While reviewing your current term life insurance policy might not seem like the most pressing issue at hand, there are absolutely some very good reasons why you should review your coverage.
Whether you recently divorced or are in the process of going through a divorce, here are 3 reasons to seriously consider giving your life insurance policy at least a second glance.
1.) Revaluate Designated Beneficiaries
If there is only one thing you do, review your selected beneficiaries on your life insurance policy, it’s that important. It is not uncommon for many people to choose their spouse as their primary beneficiary and for those that have recently gone through a divorce, this may not be the first person you want to leave a significant portion of your life savings with. Don’t make the mistake of forgetting to update your policy. Whether you choose to remain single or choose to marry again, you will want to make sure that your hard earned work over the years goes exactly to whom you desire it to.
2.) Define Paid Policy Premiums
To make things even easier, you should just go ahead and have your ex-spouse take care of any payments to the insurance company right? Well, not so fast. While having your ex pay the insurance company may be convenient you could be at risk of losing your policy in the event your ex-spouse doesn’t pay. Failure of payment will more often than not cost you your policy. If there is any concern whether or not your ex-spouse will pay, you’re probably better off managing the policy yourself. After all, having your ex pay you directly for the policy so that you can pay the premium may be a better option. Not to mention you can also look at the option of requesting to receive duplicate copies of any billing notices or lapses. Most importantly, it’s important that you have a clear understanding on your policy during and after your divorce.
3.) Determine Duration of Coverage
Divorce is a major transition in life and as such often warrants the introduction of many new changes in your life. In fact, you’ll find that your lifestyle may or may not be drastically different. Whether you are in a position of needing more coverage after your divorce or less coverage, it’s important to consider your new coverage needs. For example, how long will you need coverage for? Do you have a young family or are you getting ready to retire? During each stage of life, our life insurance coverage needs change and while divorce may not seem quite like the time to review your coverage, it is absolutely the time to review your policy.
Reassessing your current financial situation is critical during and after a divorce.
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