I didn't really pay attention much to the this issue because I was so overwhelmed when the financial agreement in my case was being put together. But it really is a good question: what do you do to safeguard yourself and your children financially in the event that your ex husband dies? So here is the answer.
In order to safeguard your child support and alimony there is CGS 46b-82 and CGS 46b-84(d) which allows the court to order life insurance naming the other party as beneficiary to secure payment of periodic alimony obligations, and/or naming minor children as beneficiaries to secure child support payments. In the same way as alimony and child support payments, an order for life insurance can be modified upon a showing of a substantial change in circumstances.
When it comes to an order for life insurance, there are things that the court can and cannot do. For example, the court can order that a party maintain life insurance to secure alimony and child support. But it cannot order that a party take on a life insurance policy which he or she cannot afford.
The Court cannot order that either party maintain life insurance for children over the age of 18. But it can order life insurance for as long as the obligation of child support or alimony lasts.
Not only is it important to have a provision that maintains life insurance to secure child support and/or alimony, it is also important that the former spouse can confirm, on a regular basis, that the insurance is in full force and effect. Unfortunately, the provision in my divorce degree that allows me to obtain proof from my ex that the life insurance policy is in place is pretty much useless because my ex, upon request, simply provides me with completely unreliable documentation. And there have been so many violations to agreements I have made with my ex that if I pursued them all, I'd be in court every day of the week. So I pretty much don't bother.
However, you can avoid the problem I've had to deal with by putting wording into the agreement that bypasses your ex husband and allows you to go directly to the life insurance company itself. Such wording would be as follows:
"Proof: Husband shall furnish written authorization to the applicable life insurance agents or companies for Wife to receive proof of the maintenance of such insurance upon request."
Also, it is important to have such a provision state that if the party did not maintain life insurance in violation of the agreement, a preferred claim may be made against that party's estate after his or her death. Such a provision could be worded as follows:
"Claim Against Estate: If Wife survives husband and for any reasondoes not receive the full benefit of the life insurance specified in this section, she shall have a preferred creditor's claim against the estate of Husband for the full amount of the insurance proceeds payable to her hereunder, less the amount of such proceeds actually received by her." Something similar could be written for the children's claims as well.
Keep in mind that according to the law, (see Hunter v. Hunter, 41 Conn. Sup. 289 (1989), if an ex spouse and/or child is removed as a beneficiary of such a life insurance policy contrary to the terms of the divorce judgment, they may recover the proceeds of the life insurance policy from the beneficiary who replaced them.
Finally, here I am being rather gender biased, assuming only the husband would be required to obtain life insurance on behalf of his ex wife and his children. In fact, the Wife can be obligated to obtain life insurance as well to cover her contribution to the maintenance of the children, etc. So it could end up with both having life insurance to cover costs in case either dies.
What is the need of life insurance and why should we have live insurance, these are the question comes into the mind when some insurance agent approaches you. In such era where things are changing rapidly, the whole world is become a global village, the prediction of future is becoming uncertain then why not one should at least try to secure his and his/her family by obtaining the life insurance.
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