life Insurance in Divorce Settlement

[pamandkev]

Hello
In 1997, I signed a divorce settlement that made provision for my ex wife to hold a life insurance policy on my life, which she paid/pays for. It is stated in settlement that the ex wife is irrevocable beneficiary of the policy, with all rights assigned to her for the benefit of our child, who was ten years old at the time.
My question is whether this provision would expire once the child became an adult, and since she is nineteen years old, now. I would like to know how/if I can loosen my ex wife's hold on my life & all I own, since I am remarried, and my daughter has pretty much disowned me and has been negatively influenced by my ex in her successful attempt to divide us.
The settlement states that if she does not receive insurance benefits as agreed, she has the right to file a claim & bring action against my estate for those benefits.
My present wife & I have been put thru so much horror & heartache, already, and the last thing I would want to happen to my present wife, should anything happen to me, would be for her to be "robbed" of what we worked so hard for.
Thank You for your time!

 

[Dandy Don]

Are you paying alimony now or have you ever paid it?

Since you have gotten off scot-free by not paying for the life insurance policy premiums, you have no argument in regards to anything about that. In fact you were very lucky that you were not asked by her or by the court to pay the premiums yourself--perhaps it was an innocent oversight by the court.

It's not exactly clear how your ex-wife has any type of "financial hold" on any aspect of your life from the facts as you have described them, but perhaps you have left something out.

Hopefully you can initiate contact with your daughter when she becomes an adult.

DANDY DON IN OKLAHOMA ([email protected])

 

[JustAPal00]

I guess I'm having trouble understanding how this affects you? She is the owner of a life insurance policy on your life. She is also the beneficiarry and she makes all the premium payments. How are you affected? I guess if she is trying to collect I could see your concern. My ex has a policy on me! I could care less. If something happens to me, it will go to help my kids.

 

[nextwife]

I'm a second wife whose hubby's wife got his life insurance.

So what? I bought my OWN policy on hubby, and also got a spousal policy on him through my office. And I protected "what we built" by how my assets and our marital assets are titled. If you do these simple things what is the risk to your wife?

 

[Betty]

Your ex-wife is the owner of the policy & it has an irrevocable beneficiary - I don't think you have much say here.

 

[Some Random Guy]

The section that seems the strangest is that

The settlement states that if she does not receive insurance benefits as agreed, she has the right to file a claim & bring action against my estate for those benefits.

The exact wording of this is crucial. For example, if the ex-wife cancels her $500,000 insurance policy and then the hubby dies, does that mean that the daughter now has a $500,000 claim against the estate? If so, then I would increase the personal life insurance for his new wife to take the risk of this into account.

 

[pamandkev]

B]Thank You for your reply Dandy Don, & all who have reached out.

Though there has been little to no attempt on my daughter's part to maintain a relationship, we have always called, sent cards & holiday gifts, etc. Emotionally, it is a difficult situation to understand, not knowing the personalities involved. But that is a different issue.

As for the "financial hold" issue...The fact that settlement states, if unable to collect from life insurance, my estate can be sued for amount that insurance would have paid, etc.
After my divorce, I owned little to nothing. My present wife and I have been working hard to build some security, purchase a home, etc.
My point is, though of course, I would want my daughter to be cared for, & receive something, her & her mom's finances are far superior to ours...It's one thing to GIVE something, and another to have someone with alot to take away the little that is needed, and worked hard to accumulate away from you. In this case it would be my present wife.
Unless I am misunderstanding the system & laws...My main concern is that if I should pass on before my wife, I would not want her to lose her home, & all we worked hard together to accumulate...For that matter, I would not want her to be subjected to compounded heartache, stress & legal expenses, in the attempt to keep our "stuff", & her security.

Maybe I am in the wrong forum, and should be in asset protection???

Thank you, and all who have responded, and to anyone who would yet reply with information. It is very appreciated


[/B]

 

[pamandkev]

I'm a second wife whose hubby's wife got his life insurance.

So what? I bought my OWN policy on hubby, and also got a spousal policy on him through my office. And I protected "what we built" by how my assets and our marital assets are titled. If you do these simple things what is the risk to your wife?

Hello Next Wife, and Thank You!
I guess I am a bit ignorant in how policies & laws work....
If, for example, the ex wife has a $500,000. policy, and then my present wife had a $500,000. policy, when I died, both would collect their coverage amount of $500,000. each..Even though my total assets may not equal that much?
You mentioned a spousal policy, which I am unfamiliar with, and also titling of your assets and marital assets. If you would not mind expounding on that, it would be very appreciated...otherwise, maybe you can point me in the right direction for more information.
Thank You again!

 

[Dandy Don]

Yes, your assumptions about the insurance company payouts are correct-- it is the insurance company that is paying out the monies and the payout does not come from your total assets.

What is your home worth and is it paid for or is there still a mortgage?

Do you have children with this spouse?

What is your income?

As long as you keep paying the premiums on your policy, that is the best way to protect your wife financially after you are gone.

I don't think you have much to worry about from anyone making a claim against your estate--since the ex-wife is almost certain to keep the life insurance in force to protect her own daughter's needs.

 

[pamandkev]

The section that seems the strangest is that



The exact wording of this is crucial. For example, if the ex-wife cancels her $500,000 insurance policy and then the hubby dies, does that mean that the daughter now has a $500,000 claim against the estate? If so, then I would increase the personal life insurance for his new wife to take the risk of this into account.

Hello, and Thanks, Random Guy!
The settlement reads exactly as follows: " The following insurance coverage on Husband's life is now in forceolicy#... The Wife shall be the irrevocable beneficiary of the insurance with all rights assigned to her in trust for the benefit of the chid. The Husband may not borrow against, pledge, or otherwise encumber the insurance. The Wife shall pay all premiums when due. If the Wife does not receive insurance benefits as agreed, she has the right to file a claim and/or bring an action against the Husband's estate for those benefits.

This does not sound too good, does it? The only information that was given to me concerning this policy, was a policy#..Not the dollar amount the policy was taken out for, or even the name of the insurance company.
Also, I have no way of knowing if she has increased the amount of coverage.

My daughter will be nineteen years old this month, though I don't think this changes anything, but was curious about the mother as beneficiary "for the child"???

Hope you can offer some guidance here.

Thanks so much, again. Your time & kindness is very appreciated.

Kevin

 

[pamandkev]

Yes, your assumptions about the insurance company payouts are correct-- it is the insurance company that is paying out the monies and the payout does not come from your total assets.

What is your home worth and is it paid for or is there still a mortgage?

Do you have children with this spouse?

What is your income?

As long as you keep paying the premiums on your policy, that is the best way to protect your wife financially after you are gone.

I don't think you have much to worry about from anyone making a claim against your estate--since the ex-wife is almost certain to keep the life insurance in force to protect her own daughter's needs.

Hi..Thanks...
Our home is the typical MCI home, $$225,000, still with a mortgage. No children with present wife

My main concern is if my ex wife has a policy for a large amount, of which for some reason she cannot collect completely, should I pass away, that she would try to get money from my/my wife's estate.

I love my daughter, in spite of the unwarranted disrespect & alienation, and of course I would want to leave her with something. As mentioned in an earlier post, my ex wife & daughter are financially stable, so I have no concern for her provision.
The point is, I would like to choose what/how much she receives, and not have to worry about my present wife being "raped", & left with almost nothing.

Thanks again.

 

[Dandy Don]

You can quit worrying, as you have nothing to worry about. Your insurance policy is going to be made payable to your wife as beneficiary and that money is payable outside of the estate and is therefore not part of it--it is hers to do with as she wishes.

If the worst scenario came where a claim was filed against your estate, if you don't have $500,000 worth of assets in your estate there is not much for her to claim.

 

[nextwife]

You mentioned a spousal policy, which I am unfamiliar with

Many employers offer their employers the option of buying a supplimental life insurance policy at their very reasonable group rates. They often also offer the option of buying a life policy that covers one's spouse. So, in addition to the individual policies one may have, it is possible to also have a policy on oneself and on one's spouse through work.

and also titling of your assets and marital assets. If you would not mind expounding on that, it would be very appreciated..

Assets that are co-owned and titled a certain way never become part of one's estate. They pass outside probate. So, if you and wife own your house together as joint tenants WROS, it automatically becomes hers (and vice versa) upon your death. Same potential for checking, savings, etc.

See an estate planning attorney and set it up correctly