Recently Divorced? Why You Need to Review Your Life Insurance Coverage
Going through a divorce can be a complicated and all be it stressful process. With countless financial obligations including but not limited to childcare support, attorney fees, alimony, and more. Divorce can get messy and at the very least, it’s life changing. Although you may feel reluctant to do so, it is important to review your life insurance policy during this time. Divorce is a major change, both in your personal life and your financial life.
It’s common for only a single spouse to possess coverage. After all, many coverage options are designed to protect the entire family. However, at this point in time, your coverage needs have likely changed. If you haven’t already done so, it is advisable to review your life insurance coverage. Whether or not you have a policy in place it is important to review all of your options before embarking on this next chapter in your life.
Reasons to Review
It’s important you have a clear understanding of your current policy and coverage. While you may have many other responsibilities right now, take the time to review your policy. Your coverage needs have likely changed as you have started this new transition in your life. Not sure where start first? Begin by reviewing the following factors to better assess your needs.
Coverage Needs Change
Over time, our needs change. Depending upon your age and stage in life, your life insurance coverage needs may vary. For some, additional coverage or even new coverage entirely may be necessary, especially for those with young children. For others, separation marks a time to reduce coverage. It’s vital to have a clear understanding of your current coverage and especially how your divorce may be affecting it. Remember, whoever owns the policy controls the policy.
Potential factors that can have a significant influence on your coverage are your custody status. If you are currently the custodial parent, purchasing life insurance on your former spouse is one of the easiest and most effective ways to protect your children, especially if you are receiving child support. Life insurance can ensure that even in the event of your spouse’s death, the support will continue. On the other hand, if you are the noncustodial parent it can also be a wise move to purchase life insurance for your former spouse, in this case, though, for very different reasons. While you may not have custody of the kids now, what if something were to happen to your spouse? You would then likely gain full custody of the children, increasing your expenses significantly. Purchasing life insurance on your former spouse can provide a financial buffer against these often-hefty expenses.
Your responsibilities are likely to change after going through a divorce, especially if you become the primary caretaker of your children. Whether you are the designated primary custody holder or not, one thing is for sure, your responsibilities are likely to be different than when you were married. Even if you do not have primary custody over your children, you may still face new financial obligations in the form of child support or alimony. The life insurance coverage, or lack of coverage, you had in the past does not likely reflect your new lifestyle. It is essential to review your policy to ensure that you’re getting only the coverage you need.
Going through a divorce can be an overwhelming experience at times, and it’s safe to say, you probably have quite a bit going on in your life right now. However, while things may seem a bit chaotic, it is important to evaluate your coverage. Divorce is a transition that brings about new changes in your life. Protecting your family’s future is still of the utmost importance, so be sure to take the time to understand your needs and take the appropriate actions going forward.
If you need assistance when it comes to your coverage, or you’re simply not sure where to go next, Term Life can help. We know life insurance coverage is not always a simple matter, which is why our team of coverage experts are ready to help. Feel free to estimate your new coverage costs with this handy Life Insurance Calculator or simply give us a Call Today.
Featured image via Engadget
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