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Understanding how life insurance plays into property division

One of the top priorities for Florida spouses who are preparing to divorce is assuring financial stability in the years to come. The entire property division process is aimed at meeting that goal, and providing a fair and equitable division of assets between spouses. That said, there are certain scenarios in which one spouse fails to follow the provisions laid out within the divorce settlement. In such cases, taking the matter back to court may be the only available avenue of legal recourse.

Consider, for example, a scenario under which a couple agrees that the husband will purchase a life insurance policy payable to the couple's shared children. That means that he will take on responsibility for making payments toward that policy for as long as necessary. In many cases, however, individuals go on to begin new relationships, sometimes even remarrying and having other children.

It is not uncommon for spouses to decide not to follow their divorce agreement, especially when many years have passed. In the case of a life insurance dispute, the individual tasked with procuring the insurance policy might decide to simply stop making payments. Another outcome is that he or she could decide to rename the beneficiaries on the policy.

If a Florida resident is concerned that the terms laid out within a property division agreement are not being adequately met, it may be necessary to re-approach the court in order to clarify the matter. Unless the other party is able and willing to turn over documentation proving that a life insurance policy remains in place with the properly named beneficiaries, taking legal action may be the only way to gain clarity on the issue. A life insurance policy can be a significant asset, one that should not be overlooked or forgotten about merely because many years have passed since the divorce was made final.

Source: marketwatch.com, "Who wins under the law - a beneficiary on a life insurance policy or on a divorce decree?", Quentin Fottrell, June 2, 2017

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