Divorce, Dissolution, Child Custody, Child Support, Legal Separation, Prenuptial Agreement, Post Decree Modification

Life Insurance and Divorce

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Recently, I was contacted by two insurance agents regarding life insurance.  Both insurance agents had similar questions regarding life insurance and divorce.  First, they wanted to know whether courts require child support obligors to obtain and hold life insurance policies for the benefit of the children, in the event that the obligor passes away.  Basically, the answer to this question, as written, is “no.”  The insurance agents were taken aback by this.  They were appaulled by the fact that if something happened to the obligor, the parent caring for the children would be left with no support or help.

While I certainly understand their concern, my response is that many of my clients (and their ex-spouses) can’t afford to pay their court ordered child support, let alone an additional insurance premium each month.  If an untimely death occurs, the beneficiaries of the obligor’s estate may have a wrongful death suit, which would reduce or eliminate the need for the life insurance policy.   (Of course, the insurance agents could probably come up with a list of the benefits of having the insurance policy in place, despite the above statements.  I’m not saying there aren’t any, I just have to keep in mind that my clients have budgets & priorities).

There are many shortfalls of our court system and especially our domestic relations divisions; however, I would not categorize this as a shortcoming of the court system.  If you believe this to be a short coming, it is really a short coming of the attorneys working in the domestic relations court system.  When I am filing a divorce for a client that is asking for custody and child support, the opposing party either has a life insurance policy in place or he/she does not.  If they do have a life insurance policy in place, I usually include in the decree that the party is required to keep the life insurance policy for the benefit of the children until the youngest child turns 18.  When this is included in the decree, the court will generally grant this request.

If the opposing party does not have a life insurance policy, I do not usually address whether he/she wants the other party to be required to obtain one.  Often times, if there is not a policy in place already, that is because there is no money for a policy.  It is not guaranteed that the court will grant the request for the order requiring the other party to obtain a life insurance policy and it may cost more in legal fees to persuade the court that such a provision is necessary.  In addition, as with any provision in the decree, such a provision is only enforceable by contempt of court.  This means that even if the court grants an order requiring that the opposing party obtain a life insurance policy for the benefit of the children, if he/she chooses not to get one, the plaintiff can only enforce it by filing a motion to have the other party held in contempt and by doing so, will incur more legal fees.

My personal opinion regarding insurance is that you can’t insure your entire life.  Bad things are going to happen, unexpected tragedies are going to occur, and losses will result.  I personally don’t like the idea of paying a premium every month to minimize that damage because there are always going to be aspects of your life that you cannot insure, or that you don’t insure (and with my luck, those are the aspects that will be affected when bad things happen).  However, I did appreciate that these insurance agents brought this issue to my attention.  Just because I personally don’t beleive in insuring all aspects of my life, it doesn’t mean that my clients may not benefit from discussing this issue with a knowledgable professional.

In the future, I will be discussing life insurance with my divorce clients and hopefully, they will learn and benefit from it, even if they choose not to request that the other party obtain a life insurance policy.

Divorce vs. Dissolution

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One of the most common questions I get from my family law clients is about the difference between a divorce and dissolution.  Although they accomplish the same thing, there are many differences between a divorce and dissolution and most of the differences relate to the total amount of money you will spend to terminate your marriage.

A dissolution is often considered the amicable way to terminate a marriage. With a dissolution, the parties come to an agreement on all terms of separation, including: property division, spousal support, child support and parenting time.  They put their agreement in writing and they present it to the court.  The court will make their agreement an order of the court as long as it finds that both parties voluntarily entered into the agreement, the parties fully disclosed their assets and debts, and it is a fair and equitable division of property.  Both parties must cooperate throughout the process and both parties are required to appear at the final hearing.  Dissolutions often cost less, especially when the parties have their agreement worked out before an attorney gets involved.  Parties can keep their costs low, not only by working out all details of their agreement before meeting with an attorney but also by finding an attorney that will do the work on a flat fee.  Although most family law attorneys will not work on a divorce for a flat fee, many do offer flat fees for dissolutions.  You will also find that the filing fee is less for a dissolution.  In the Cincinnati/Dayton area, you will find that the filing fee is between $250-$350.

Although divorces do not involve an agreement between the parties, not all divorces result in disagreements between the parties.  There are two types of divorces: uncontested and contested.  Once one of the parties files a complaint, it is considered a divorce.  If the responding party files an answer, it is then considered a contested divorce.  If no answer is filed, it is considered an uncontested divorce.  You may be asking yourself why anyone would file for a divorce if they are not having disagreements about the terms of separation.  The answer is that many times people choose to file for divorce because the other party will not cooperate with the dissolution process by signing the necessary forms and going to the final hearing.  In those situations, a divorce is a better option, and if the other party does not file an answer, the process will be similar to a dissolution in terms of time and money.  If you suspect or know that the other party will not respond to the complaint, you may ask your attorney if he/she will do an uncontested divorce for the same price as a dissolution.

The most expensive way to end your marriage is a contested divorce.  The court often sets several pretrial dates in the hopes that the parties will come to an agreement and in the end, most contested divorces do end in an agreement; however it may take a very long time to get to that point.  If you find yourself in a contested divorce, you may feel that there is nothing you can do to save money.  The filing fee is often between $300-$400 and attorneys often refuse to work on a flat fee.  Sometimes the other party is just being disagreeable or has unjustified expectations.  You can, however, save yourself some money by finding an attorney that approaches your case with your best interests in mind.

If you find that you are more upset at the other party when you leave your attorneys office than when you went in, it is possible that your attorney is intentionally winding you up to fight so that you spend more on attorney’s fees.  If you suspect that you may be in this situation (and believe me, I see it all the time), you should evaluate your expectations and determine if they are reasonable.  If your attorney has given you unrealistic expectations, you will be unhappy with the result no matter what happens and you will spend more.  You should find an attorney that gives you realistic expectations about your case.  An attorney that really has your best interests in mind will not be able to prevent the opposing attorney from using the same tactic to rack up attorney fees but will at least provide a starting point for getting your divorce settled with a fair result at a reasonable cost.

No matter how you decide to terminate your marriage, it is likely that your attorney will have you fill out a long questionnaire regarding every aspect of your marriage.  It is important to understand that every question is on that questionnaire for a reason.  Your attorney will have to report that information somewhere in the paperwork.  If you take the time to make sure that you have filled out each and every section of that questionnaire before returning it to your attorney, your attorney will spend less time following up on incomplete information; therefore saving you money.