Dissolving a marriage often brings a tide of changes. For instance, divorcing couples must consider how ending their marriage affects insurance.
NerdWallet explains vital coverage changes for those going through a divorce. Keeping policies current better ensures they provide the proper coverage.
Those who pay little attention to their disability coverage may want to prioritize it when they end a marriage. It makes sense to change disability insurance before finalizing a divorce. Parties who receive child support or alimony may want to require an ex-spouse to have disability coverage as part of the divorce agreement. Those with a job may want to look into securing their own policy.
If spouses divorce without financial obligations tying them together, they may remove each other as beneficiaries from their life insurance policies. A divorce agreement could require one spouse to have life insurance with the ex-partner listed as the beneficiary. That way, if the spouse paying child support or alimony dies, the surviving ex-spouse may use the payout as a payment replacement.
Partners who have individual health coverage may keep their separate policies after ending their marriage. A person could remain on an ex-spouse’s health insurance plan after the divorce, but that depends on the state and the insurance carrier. Those who lose coverage may see if their employer offers health insurance, buy an individual policy from the health insurance marketplace or an insurance company, or pay for coverage received from an ex’s policy.
Divorce affects a person’s finances in various ways. By understanding those changes, divorcing couples may set themselves up for peace and happiness.