When you’re in the midst of a divorce, what happens to the insurance policies that you and your spouse have may not be uppermost in your mind. However, it is crucial that you and your children remain covered on all of the policies you have come to count on and perhaps add coverage you may need as a newly-single person.
Health insurance, of course, is vital. The disposition of a couple’s health insurance and coverage for their children should be part of their divorce agreement. The same is true for additional medical expenses not covered by insurance. If you will no longer be covered through your ex-spouse’s plan, you can apply for continuing coverage under the Consolidated Omnibus Budget Reconciliation Act, or COBRA. That is available for a limited time only and can be expensive, so it’s probably best to arrange for your own plan as soon as possible.
You should have disability insurance if you are supporting yourself and your children. It generally pays about 60 percent of your income if you become ill or disabled.
Life insurance will also be more crucial than ever. If you already have it, you’ll want to make any necessary beneficiary changes.
Long-term care insurance is something that too many people don’t consider until later in life when the premiums are higher. LTC insurance helps cover the cost of assisted living facilities in-home nursing home care. After a divorce, you may not have the support system you once counted on. Even people with many family members can find themselves requiring care that loved ones simply can’t provide.
You need to take a look at your homeowner’s or renter’s insurance policy. If you are staying in the home and your spouse is moving out, be sure that he or she is no longer listed as a “named insured.” If your policy is not updated to reflect who is in the home, your coverage may be voided. If the premiums are too much to handle as a single person, you may want to increase your deductible.
Your North Dakota divorce attorney can assist you on necessary changes to your insurance policies and determine which policies need to be included in your divorce agreement. Your insurance agent can also advise you on the necessary changes to keep you insured at a rate that you can afford as you move forward as a newly-single person.
Source: Association of Divorce Financial Planners, “Divorce and Insurance” Sandy Voit, CDFA, LMHC, Oct. 06, 2014
