For couples who are separating or going through a divorce, there are many decisions to make regarding your finances. But when your circumstances change, it’s important to make sure your insurance is still meeting your needs.
Separating your finances
Insurance policies are just one of the shared asset types many couples hold, along with the home, car, super, business, savings and investments – and they might all need to be separated. Some of these assets may be split down the middle, but life insurance may not be so simple. Life insurance can be set up in different ways, and this will determine who owns the policy, and who has the authority to change it. Types of policy ownership include:
- Individual ownership: If you’re the owner, you may continue with your own policy, but you may consider changing beneficiaries if you previously appointed your partner.
- Joint ownership: If you share the policy with your partner, both parties will need to agree to any changes.
The above are two of the more common types of policy ownership, but there are other options. If you would like to discuss which is applicable to you or the best structure for your circumstances moving forward, please reach out.
Update your beneficiaries
For many couples, their partner is their main beneficiary. Even after a divorce, couples who share custody of children or have shared financial responsibilities may decide to keep their ex-partner as a beneficiary until their circumstances change.
The beneficiary of a life insurance policy does not have to be a partner. Parents could nominate their children, although they must be over the age of 18 to receive a payout. You may also name your parents, a business partner, a friend, a sibling or a trust to manage your affairs after you’re gone.
Divorces can be complex, and there are a lot of emotional and financial decisions to make. If you’re experiencing separation or divorce, I can help you navigate the financial implication of these changes and provide you with insurance protection tailored to your needs as you embark on the next stage of your life, book a time to chat.
Source: TA
Any advice is general in nature only and has been prepared without considering your needs, objectives or financial situation. Before acting on it, you should consider its appropriateness for you, having regard to those factors. Before making any decision about whether to acquire a financial product, you should obtain the Product Disclosure Statement
