Life Insurance

Obligation of parent

According to the financial obligations of an individual under the terms of the Divorce Agreement, that individual may be required to maintain life insurance on his or her life with the other as beneficiary, in order to fulfill those obligations. This life insurance obligation may also be funded through a life insurance trust.

One common problem for a divorcing couple is that a spouse’s current life insurance death benefit is inadequate for their financial obligations as per the divorce settlement, and the couple must decide whether that spouse will be required to obtain additional life insurance. If one party does not have a financial obligation, that party will generally not have a life insurance obligation under the terms of the divorce settlement.