Divorce and Insurance: Issues to Consider

A recent story from Fox Business underscored the insurance issues raised by a divorce, and gave some practical considerations as to how to deal with those issues. One common issue is the maintenance of health insurance coverage for children. Typically, the parent who has traditionally provided the coverage, or who is able to do so at the most reasonable cost, will be the parent who is ordered to provide the coverage. Uninsured medical expenses may be divided equally between the parties, or may be divided in a manner commensurate with the parties’ respective incomes. In any case, the costs of maintaining health insurance are always included in the calculation of child support obligations. Disputes over health insurance coverage for children may arise, however, if one parent moves out of state, thus making a child no longer eligible for the other parent’s health insurance coverage, or if the parents cannot decide which one should bear the responsibility of keeping a child insured until the age of 26, as is an option under the Patient Protection and Affordable Care Act, long after child support obligations have ceased.

Other insurance-related issues that may arise in the context of a divorce include life insurance policies and automobile insurance for children who reach driving age. Typically, no court will mandate that a parent maintain vehicle insurance coverage for a child; this type of insurance coverage is a privilege rather than a necessity. Parents usually will have to come to some agreement between themselves in order to decide who will bear those costs, and if no agreement can be reached, the custodial parent may be stuck with the bill if he or she wishes the child to have the ability to drive. Likewise, in joint custody situations, both parents probably should bear some responsibility for maintaining the insurance coverage. Similarly, parents often must make decisions about what to do with life insurance policies after a divorce. Some parents choose to leave their ex-spouses as beneficiaries of their policies, assuming that they will use the proceeds to care for the children. In other cases, the beneficiaries should be changed to another trusted relative or made payable to a trust that is set up for the benefit of the children.

Insurance issues may not be at the forefront of your thoughts when you are getting divorced, but they are important issues that you must consider and resolve. Fortunately, with the help of a skilled DuPage County divorce lawyer, you will be able to explore all available options and make the decision that is best for you and your children.

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