Life insurance after divorce

Divorces are pretty disastrous, but even more when it comes to discussing life insurance after divorce. While you set your mind on dividing your assets, you end up forgetting that your insurance does require some changes.

You can either cancel life insurance after divorce or probably change up a few things mentioned in the policy, like the beneficiary etc. You might have bought life insurance as a couple when you were married, but you might have to split your joint life insurance policy after divorce. 

Salient points - 

1. Both the beneficiary and the owner should be informed about the change.
2. Figure out the cash value and divide it.
3. Set an amount for your child, or if you are a single parent, keep it for yourself.

Change in beneficiaries

It is often seen that the partner/spouse is the primary beneficiary when someone assigns life insurance so that the household is not affected by their sudden departure. But, once you get divorced, be it amicable or acrimonious, you would not want your spouse on it anymore, unless and until there is a child involved. 

Beneficiaries can be changed in this case, or you could cancel life insurance after divorce.

Note that, some policies might not be reversed or changed in terms of beneficiaries, so ask your company to inform you of such.

Alimony and Child Support

Alimony is the financial support ordered by the court to give the spouse during a divorce. Child support from one to the other taking care of the child is solely an amount used up for child care expenses. 

Now, if the non-custodial parent is the earner, the custodial parent survives on the life insurance after a divorce. Either this or sometimes, the non-custodial parent might not be a financially responsible person, so keeping the insurance with the other, would be a great choice.

Cash Value

The policyholder is always given the accrued amount after a certain time course. Cash value is a specific per cent of the premium, added to the actual insurance amount. It is the net worth as a couple.

If you plan to cancel life insurance after divorce, you can for better, cash it out and divide it with your ex and yourself.

Life insurance is often not a priority when it comes to divorces in India. Covert to be honest. A joint life insurance policy after divorce is a great aspect if cancelled and benefitted out of.