There are a number of different insurance policy changes that need to be made once a divorce is finalized. These include:
Auto insurance – Many couples are both listed on the car insurance policies for all their vehicles, but most do not know that a change in the ownership of a vehicle will necessitate a change of who holds the policy. You will probably want to remove your spouse from the policy on your car anyway, to protect yourself against liability in case he or she gets into an accident. If your ex is continuing to pay for your auto insurance, be sure to give the insurance company your contact information as well. After an accident is no time to find out your insurance has lapsed for nonpayment.
Homeowners insurance – The person who stays in the marital home following a divorce needs to make sure the homeowners’ policy is in his or her name. It is also wise to review the policy to make sure it insures you for the replacement cost of the home and/or your possessions, and is not a cash value policy, which only pays the current value minus a depreciation deduction. If you have divided your possessions, you want to be sure your policy covers only those possessions you still own. And if your income is now smaller, you may want to raise your deductible to get smaller payments. However, if you will both remain on title to the home and have an agreement that it will be sold at a later date, you both should remain on the homeowners insurance policy.
Life insurance – If you have to pay alimony and/or child support, a life insurance policy may be part of your divorce settlement, so that support can continue if the paying ex-spouse dies. Many couples, especially those with children, have life insurance policies that name the surviving spouse as primary beneficiary. You may need to revisit this designation in light of your new circumstances.
Disability insurance – If a person is providing alimony or child support, consideration should be given to a disability insurance policy that will cover them in the event they become disabled and can no longer work.
Health insurance – If one spouse is covered under the other’s employer insurance program and they divorce, the dependent spouse usually qualifies for COBRA coverage for a period of up to 36 months, until they can find their own insurance coverage. This should be a part of the divorce settlement but in certain cases can be more expensive than seeking independent coverage on the open market.
It is important to note that while the divorce action is pending, you must maintain all existing insurance coverage under New Jersey law, which holds:
“Upon filing of a complaint for an action for divorce, dissolution, nullity or separate maintenance, where the custody, visitation or support of a minor child is an issue, the party who has maintained all existing insurance coverage or coverage traditionally maintained during the marriage or civil union, including but not limited to all health, disability, home or life insurance, shall continue to maintain or continue to share in the cost of maintaining the coverage.”
You deserve a legal team that will maintain trust, respect, and dignity throughout your divorce process, while still delivering high quality advocacy and superior outcomes. Protecting your interests and achieving results which supports your needs is what you can expect from Murphy & Cistaro. Contact us today for your free consultation.