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Life Insurance and Divorce
Life Insurance is an important matter in most divorces. There are a host of issues that are not addressed in the typical negotiation. Consider the following sample insurance clause from a Property Settlement Agreement (PSA):
The husband shall maintain life insurance for the wife having an aggregate death benefit of $250,000. Said obligation shall be terminated if the husband's obligation to pay alimony is modified/terminated. The husband shall maintain life insurance having an aggregate death benefit of $250,000 for the benefit of the unemancipated children. Said benefit shall be reduced by $75,000 upon the emancipation of the first child and again upon the emancipation of the second child. The obligation to maintain any life insurance for the children shall terminate upon the emancipation of all Three (3) children.
This article evaluates many of the important decisions and considerations not addressed in such a simplistic clause, and gives practical recommendations and advice on how better to address life insurance issues.
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