After the Divorce: Update Insurance Policies and Beneficiaries

Don't forget to check out all of your insurance policies after your divorce is final.  

Insurance policies are easy to neglect, but it’s important that you review all of your insurance and get it in order. If one insurance agent helps you with all your coverage, schedule a meeting to go over everything. Try to gather as much information as you can, and avoid buying new products right away, except the life and disability insurance that you should have if you’ll be paying support. Insurance agents are salespeople first, so maintain a “buyer beware” attitude.

Health Insurance

You’ll be dealing with the federal law called COBRA if you’re staying on your former spouse’s health  insurance plan. There are very strict time limits for signing up for continued coverage, so if you’ve been putting this off, find your paperwork and get it taken care of right away. Verify that the plan administrator has been notified of COBRA election by a nonemployee spouse.

Life or Disability Insurance

If you own life insurance, you may want to change the beneficiary from your former spouse to someone else.  Even if you don’t want to make this change, you still have to fill out new forms. That’s because in many states, the original designation is automatically revoked by the divorce. So if you want your ex-spouse to get the benefits because he or she would be raising the kids alone in the event of your death, you’ll need to fill out a new beneficiary designation form after the divorce is final to make it clear that you still want your ex to be the beneficiary.

If your spouse agreed, as part of your divorce negotiation, to buy or keep life or disability insurance with you or your kids as the beneficiaries, follow up. Your marital settlement agreement should say that you are entitled to get information about the policy. Your post-divorce task, then, is to follow up with a letter to the insurance company letting it know that you have this right, and asking to be notified if there’s any change in the policy or any problem with premium payments. Send a certified copy of your divorce order with the provision about your access to information highlighted, and say you’ll be checking in regularly to confirm the order’s being complied with. Send a copy of the letter to your ex, too.

If you didn’t get an order like this from the court, or if your spouse bought the insurance later, then ask your former spouse to voluntarily provide you with documentation that the insurance is in place.

Auto Insurance

Contact your insurance company and make sure the vehicle you’re driving is properly insured and that you’re the only owner of the insurance policy. It’s likely that after the car was transferred into your name alone a new policy was issued with you (and possibly your driving-age kids) as the only insured. Get a copy of the declaration page, the sheet that says what coverage you have and who is covered.

Excerpted from Nolo’s Essential Guide to Divorce, by Emily Doskow

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