Many Florida spouses expect to receive spousal support from their former partner. They anticipate having this additional source of income to help cover monthly living expenses, set aside savings and generally provide a financial cushion for the years that follow the end of the marriage. However very few consider the role the life insurance plays in the divorce process. Life insurance is something most people think about in terms of providing financial security for those they love, but it can be just as important between former partners who no longer hold each other in such regard.
It is important to remember that alimony payments will only come in while the paying party is still alive. In the event of an untimely death, those payments will cease. That can leave the recipient in serious financial straits. Without an adequate level of protection in the form of life insurance, he or she could experience a sudden decrease in monthly income.
Some people assume that the only person who can procure a life insurance policy is the person who will be covered under that policy. In reality, however, either party can purchase a life insurance policy. This means that during the course of the divorce, a spouse who expects to receive spousal support can buy his or her own policy to cover the life of the soon-to-be ex. Doing so provides an additional layer of security versus having the paying party procure the policy him or herself. That's because unless an individual is named as the "owner" of the life insurance policy, he or she could be removed as beneficiary at any time.
Florida spouses should consider this issue while approaching spousal support or child support payments as part of their divorce. Obtaining life insurance coverage is an important protective measure that can ensure the continuation of those payments, even in the event of the death of the paying party. That can lead to additional peace of mind for the recipient based on the understanding that financial support will continue no matter the circumstances.
Source: Forbes, "Gray Divorce: A Financial Double Whammy For Women", Jeff Landers, July 13, 2016