Divorce is a messy process. Amongst attending court proceedings, dividing up assets, and readjusting to a new life without your spouse, important actions like revising your life insurance policy can fall through the cracks. Having your financial interests in order is essential, especially when children are involved. Here’s what you should expect from the process.

Changing Beneficiaries

It’s likely that you currently have your spouse designated as the primary beneficiary on your life insurance. This should be updated if you have a revocable policy and don’t want your ex to benefit from your death, especially if they’re financially irresponsible.

You can designate your child as the new primary beneficiary or a close family member or friend if kids aren’t involved in the divorce proceedings. Reassigning beneficiaries means you’ll also have to update other estate planning documents.

Alimony & Child Support Payments

It can be beneficial to purchase a life insurance policy on your former spouse. If you’re taking primary custody of the children, you should have a plan in place if they pass unexpectedly. A comprehensive policy can ensure you receive alimony or child support payments until your last child turns 18, no matter the circumstances.

Dividing Cash Value

Divorce proceedings include dividing up marital assets, including your net worth. An integral part of your net worth is the amount of money you’ve put into a life policy during the marriage.

Universal and whole life insurance policies accumulate value since a portion of the payments gets distributed into an accessible fund that grows with interest. This cash value is typically split in half if you and your ex-spouse are co-owners of the policy.

If you need to adjust your insurance policy after a divorce, contact Reid Insurance Group in Lovington, NM. This independent agency has catered to clients’ needs since 1945, working with several prominent partner companies to offer the best home, auto, life, and business insurance options. To request a quote, visit their website or call (575) 396-3645.