With all the benefits of life insurance come the added questions that go with it. Working with an experienced divorce attorney can help alleviate these issues while creating a financial solution that best supports the child and the payee spouse.
Queens, NY (PRWEB) November 30, 2015
The divorce process in New York often focuses on how both spouses will divide assets and structure the care of their children. This can be enforced through alimony payment and child support. But what about the unforeseen consequences that may not be addressed in the courtroom? What if the paying spouse dies – what happens to the financial well being of the surviving spouse and the children? Bruce Feinstein, Esq., an experienced divorce and family law attorney in New York, recently addressed this question with clients and families the Queens area.
One way to ensure that child support and alimony payments continue despite the paying parent’s death is to secure those payments with a life insurance policy. Some spouses already have life insurance, while others who qualify can obtain new or increased life insurance coverage during the divorce proceeding. Life insurance policies to cover the payor’s support obligation are a way to safeguard the costs of raising a child in the event of the paying parent’s death. This can be especially important in divorce cases where there is a lot of money at stake.
While life insurance functions as a safety net for families and spouses, it is not required by law in the state of New York. Even though it is not a statute, spouses often work with their divorce lawyers in New York to establish the ground rules for securing life insurance during the divorce negotiations. “The separation agreement should address this topic and all its issues with a life insurance provision,” explains Mr. Feinstein. “This can help cover topics such as determining the beneficiary of a life insurance benefit, next steps if the payor changes coverage, and issues of a spouse eliminating coverage.”
The issue of a life insurance benefactor is one of the most common questions Mr. Feinstein receives. The insurance policy can be made payable to the child, which brings up questions of dealing with the policy if the spouse dies before the child is 18 and has not reached the ago of majority. Or, the proceeds may go to a pre-designated custodian who can hold the insurance payout for the benefit of the child until he or she reaches the appropriate age. A third option is assigning the ex-spouse as the beneficiary, although the proceeds may be affected by a bankruptcy or the claims of the ex-spouse’s current spouse. “With all the benefits of life insurance come the added questions that go with it. Working with an experienced divorce attorney can help alleviate these issues while creating a financial solution that best supports the child and the payee spouse,” says Mr. Feinstein.
The Law Offices of Bruce Feinstein has nearly two decades of experience in divorce and family law, helping clients and families resolve their issues and move forward with their lives. If you are thinking of getting married or divorced and want more information visit feinsteindivorcelaw.com or call (718) 475-6039 to reach the New York office.