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Life and health insurance needs should be reviewed during divorce

Probably any divorcing Massachusetts couple will attest to the fact that once the decision to split has been made, everyone involved begins a process that is often lengthy, stressful and fraught with challenges. During this difficult period, with all the issues that must be considered, people sometimes overlook important areas that will change with the divorce, such as insurance coverage. Divorcing individuals should be sure to review all insurance policies and prepare for any changes that will happen with the change in their marital status.

Regarding health insurance, often one spouse carries an employer-sponsored health plan through work that also covers the other spouse. Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), individuals can continue coverage they’ve received through their ex-spouse’s employer insurance plan for up to three years. However, since this is a short-term solution, a divorcing person in this position is wise to explore other health insurance options if the individual does not have access to his or her own employer-sponsored insurance. The Affordable Care Act has opened up more affordable health insurance options for such situations.

Divorcing individuals also need to review life insurance needs before the divorce is finalized. If spousal support is part of the divorce agreement, and the payer dies, the person receiving the support will lose that stream of income, unless the payer carries a life insurance policy. In some cases, the divorce agreement will require the payer to carry life insurance. In this case, to protect individual interests, ideally, the person receiving the support should retain the policy in his or her name and make regular payments on it. Finally, divorcing individuals are wise to finalize all life insurance needs before the divorce is final, so that any necessary adjustments can be made to the agreement.

Many people who are just beginning or are in the midst of dissolving their union may find the task of considering insurance needs and sorting through options daunting. However, as with all the difficult considerations required during this time, they will likely appreciate the long-term benefits of making thoughtful decisions now. Many people in this position seek help from a professional skilled in this area. As well, most divorcing couples find all aspects of the divorce process easier to navigate with the assistance of a Massachusetts family law attorney.

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