How Will Divorce Impact My Life Insurance?
Life insurance is a major investment that can drastically impact your entire family after you pass away. While going through a divorce, making sure that you have security on your life insurance only becomes even more important. Otherwise, you and your beneficiaries could miss out on the benefits that you already paid for. Figuring out how the divorce will affect your life insurance can be difficult. Talk to an Oklahoma City divorce attorney if you have any questions.
Does Divorce Affect Life Insurance?
The reality is that there are no universal laws that control what happens with life insurance during a divorce. This decision regarding the effects of divorce on life insurance is generally left up to the court judges and spouses. Some cases simply leave this up to each spouse.
In many cases, the person who owns the life insurance plan is the one who can ultimately decide. People who have ownership of the life insurance plan have the power to remove their ex-spouse. Then they can choose a different beneficiary to add to their life insurance plan.
However, this might be blocked depending on prior agreements or certain life insurance policies. Sometimes, it comes down to what a specific life insurance policy says. Talking with the life insurance agent might be helpful for figuring this part out.
When one ex-spouse does not remove the other ex-spouse from the policy, then the Oklahoma residence laws take over. However, some states may see the division of property in a divorce as not enough to remove an ex-spouse from life insurance. Some judges may require more justification for the removal of a beneficiary.
Consider contacting an Oklahoma City divorce lawyer who can help you figure this out. Life insurance and divorce cases can be extremely complicated. A lawyer can help you figure out what your legal options are.
Importance of Life Insurance
Life insurance offers several financial benefits for loved ones after the life insurance owner passes away. The main benefits of life insurance include:
- Coverage of expenses related to passing away
- Payments for death taxes and estate taxes
- Income replacement for the beneficiaries
- Potential savings with cash value
Expenses related to passing away range from funeral costs to unpaid medical bills. Burial fees, estate administration costs, and debt also fit this category. When the owner of life insurance was the main source of income, the insurance plan can cover lost income for loved ones.
Depending on the type of life insurance plan, some owners are able to use built-up cash value. They can withdraw the money not paid out as death benefits at almost any time. This is helpful for building up a savings account.
Divorce Lawyer in Oklahoma City
Navigating the legal aspects of how life insurance will be impacted by your divorce can be confusing. Feel free to ask an Oklahoma family attorney for guidance. Contact the Putnam Law Office today at (405)-849-9149 for a consultation about your case. We can help you figure out how the divorce might affect your financial situation. Mr. Putnam is a dedicated lawyer in Oklahoma City, OK who can help you fight for the divorce outcomes you want.