Why you may need life insurance in your divorce agreement

On Behalf of | Feb 8, 2021 | Family Law, Uncategorized |

If you are going through a divorce in Texas and alimony or child support are involved, you may also want to talk about life insurance. This will mean that even if something happens to the person who is paying support after the divorce, money will still be available to the recipient.

What life insurance should cover

You and your spouse may want to agree on the purchase of life insurance or the maintenance of existing life insurance as part of the divorce agreement. To determine how much the policy should be worth, you should calculate how much is supposed to be paid for alimony and child support. Although a parent generally cannot be compelled to include college costs in a divorce agreement, it is also not uncommon to do so, and the life insurance calculations should include this as well. You should keep in mind that college costs are not just about tuition and other school-related expenses. During the college years, your child may be essentially as financially dependent on you as they were while they were a minor. Finally, you should make sure that there is also enough to cover health insurance and any other medical expenses.

Alternatives to life insurance

If the person paying support is not eligible for life insurance, you may want to look into other ways to make sure there is some security for the other parent and child. For example, they could be included in the estate plan.

One of the drawbacks of a divorce is that it can leave people less financially stable. Therefore, it is important for both individuals to take steps to protect their financial interests whether they are paying or receiving support. Shared property is supposed to be divided equally in Texas, but there may be some room to negotiate how this division happens to better suit both individuals.