Divorce & Life Insurance Rights for Ex-Spouses
Divorce is considered to be a life-changing event. It often has a significant impact on one’s finances, as well as their personal and professional life. One area that divorce can have an impact on is life insurance.
Regardless of the terms of the divorce, it is important to understand that divorce does not automatically cancel a life insurance policy in every state. If an ex-spouse is the named beneficiary on a life insurance policy, they still may the right to collect the death benefit if the policyholder dies as there are seven exceptions.
This can be a difficult situation for the policyholder, as they may not want their ex-spouse to benefit from their death.
There are 7 Exceptions to the Automatic Revocation Statute and our attorneys will win
List of States Which Have Divorce “Automatic Revocation Statute”
- New Jersey
- New Mexico
- New York
- North Dakota
- South Carolina
- South Dakota
Changes You’re Likely To Face
When a couple gets divorced, there are a lot of changes that need to be made in order to adapt to the new status quo. One of the changes that need to be made is the life insurance policy.
If you have a life insurance policy that names your ex-spouse as the beneficiary, then they will still may be entitled to the death benefit even after the divorce is finalized. This can be a problem if you don’t want your ex-spouse to benefit from your death.
There are a few options available if you find yourself in this situation. You can change the beneficiary on your life insurance policy to someone else right after divorce, such as a child or a close friend. Or, you can cancel the policy entirely and get a new one that doesn’t name a beneficiary at all.
However, you risk losing money with the latter option.
Options Your Ex-Spouse Has As A Life Insurance Beneficiary
It’s important to note that while you, as the policyholder, have rights, your ex-spouse will also have rights that allow them to file a claim after your demise. This is why you should keep above options in mind or consult with an insurance attorney beforehand.
It will help you understand the options and legal rights your ex-spouse has unless you cut them off deliberately. Even after a denied claim, they can appeal the life insurance claim after divorce.
Appealing Denied Life Insurance Claims After Divorce
Our life insurance attorneys can fight any automatic revocation statute.