If you are going through a divorce in Georgia, you need to consider how all of your financial assets may be affected. One of the most overlooked issues is life insurance. Many divorcing spouses have no idea how life insurance will be affected by the upcoming divorces, and this should come as no surprise. After all, life insurance is complicated enough on its own – without even taking into account the added factor of divorce. But when you really break it down, handling life insurance correctly during a divorce is actually quite simple.
Do I Even Need to Worry About Life Insurance During a Divorce?
The good news is that your life insurance policy itself is not considered a financial asset in the context of a divorce, making it ineligible for the equitable distribution process in Georgia. However, the underlying money value of the life insurance can indeed be divided during a divorce – especially if you have opted for whole or universal life coverage. The manner in which your policy is divided depends on the specific type of policy you have chosen.
Changing Your Beneficiaries
One of the first things you will want to consider as you approach divorce is whether to change your beneficiaries. In many cases, spouses do not want their exes to cash in on their life insurance policies after their passing. In fact, this is often the last person they want to receive that cash. Because of this, it makes sense to remove your spouse as a beneficiary of your life insurance policy as soon as possible – preferably immediately after the separation date.
The real question is who to name instead of your ex. The obvious choice is your biological child – but what happens if they are still a minor? In this situation, your ex may still receive the cash value of the policy after your passing – even if you remove them as a beneficiary. Why? Because they become your child’s only legal guardian after your passing, and the court determines that they should hold the money until your child comes of age.
Your best bet in this situation is probably some kind of trust. This means that upon your passing, your trustee will manage the funds instead of your ex. When the child comes of age, the trustee will distribute the funds to them. This means that your child can still receive the cash value of the life insurance policy without your ex ever getting their hands on it.
Where Can I Find a Qualified Divorce Attorney in Georgia?
If you have been searching for an experienced divorce attorney in Georgia, look no further than Lankford & Moore Law. Over the years, we have helped numerous divorcing spouses with a range of issues – including those related to life insurance. We know that life insurance can be difficult to wrap your head around, but this process becomes much easier when you receive guidance from a qualified legal professional. Book your consultation today.
