Divorce and insurance

Couples in California who decide to get a divorce are likely to find that the process can be long and complicated, resulting in number of practical, financial and emotional issues for everyone involved. Even though divorce can take a stressful toll, it is important that both spouses do not ignore insurance coverage. They should make sure to reevaluate all of their insurance policies to understand how their coverage may change after the finalization of the divorce and how to prepare for those changes.

One important type of insurance that has to be addressed is health insurance. In many cases, one spouse is covered under the other spouse, typically the spouse with the higher income and who has a health plan sponsored by an employer. According to the Consolidated Omnibus Budget Reconciliation Act, or COBRA, spouses who do not earn an income can remain under their ex-spouse’s employer plan for as long as three years after a divorce.

Thanks to the 2010 Affordable Care Act, divorcees who do not have access to an employer-sponsored health plan of their own have more affordable options for health insurance. This even applies to divorcees with pre-existing conditions.

Another important type of insurance that should be addressed during a divorce is life insurance. This may be particularly important to individuals who will receive spousal support, as the support typically ends when the payor dies. However, with a life insurance policy in place for the payor, the payments can continue.

A divorce attorney may work to obtain favorable divorce settlement terms for clients, including those regarding insurance policies. The attorney may advise clients of their options regarding how to extend health insurance after a divorce and how negotiating for a life insurance policy on an ex-spouse may ensure that spousal support payments continue after the death of the payor.